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A Briefing for regulators and observers of the EDI communication industry by Alan D. Wilensky, Contributing Analyst, (412) 353-9269 abmadw@gmail.com
At Issue: Value Added Network Interconnections At Issue: Competition Amidst Consolidation The Basic Principals Governing Competition Among Peer Networks The Network Effect - exploiting network scale to squelch competition EDIs deficient routing architecture is easily exploited by one bad actor with capital backing Hierarchical routing plus agnostic access made the Internet EDI VANs: problematic routing policies, and traffic handling deficiencies Accelerated adoption of B2B automation stresses the VAN interconnect system EDIs closed paths - not good for competition in an Enterprise 2.0 world Competition: B2B Web Applications, Cloud Computing, and Enterprise 2.0 Enterprise 2.0 and EDI - dancing while the matchmaker is under assault Safeguarding alternative EDI innovators is the best strategy in the regulators playbook The Simple Remedy Appendices UK EDI Service Providers: NetEDI Opinions of market participants and evidence of interconnection refusals and procedural Interference by Tradanet UK: Supporting Partial Chronology Interconnection Denial Cases files: of ECGrid Network Operations Where OFT and others erred in gauging the availability of communication alternatives UK Market Share Pie Chart
1EDI
Communications are provided by Value Added Networks, Electronic Commerce Service Providers (web commerce
applications on-demand), and Enterprise 2.0 SAAS (on-line accounting, inventory, and horizontal web apps).
2Interconnect
Arbitrage: the opaque practice of granting and withholding peer access to influence a connected marketplace. The practice was perfected by AT&T, freight terminal operators, and petro-pipeline monopolies until the laws of common carriage were applied.
Standing silently at the nexus of this disputation are the commercial trading parties, customers of Loren Data Corp ECGrid and GXS TGMS (and the aforementioned) EDI transaction networks; although commonly overlooked amidst periodic network upheavals, and the tides of disruptive technology changes, their standing as parties engaged in mutual commerce, submitting communications with the expectation of delivery, should be considered sacrosanct. Blatant market manipulation via a hostile hegemony does not serve the purposes of free trading, or the evolution of innovative technologies. With a sober study of the issues at hand, the author is confident that concerned parties will agree that the concept of beneficial monopoly is undesirable and inherently toxic to technology driven markets. Safeguarding competition and preserving a climate of innovation within the B2B technology marketplace requires stern vigilance against the formation of reconstituted, AT&T style monopolies. The breaking of the EDI Communications industrys practice of granting permissive, collegial interconnection serves no one, and threatens to cripple further growth of the sector. Industry stakeholders and regulators alike should work together to insure that the trading partners are not forgotten in the midst of this frothing controversy.
3uncompensated
bi-directional Communications
5) Where do the eCommerce Service Providers (ECSPs) fit in? - These companies offer an ondemand model. They are the new power in supply chain automation, wielding more aggregate influence than any VAN. Paradoxically, service providers are reluctant to actualize their power, as they are transitionally dependent on one or another VAN for their temporal EDI communications. The Electronic Service Providers hesitancy to act prevents them from gaining the upper hand they deserve as established players in the B2B technology market. ECSPs could dominate the ecommerce sector4, yet collectively play a conservative hand; a subliminal fear of GXS-instigated communications discontinuity as retaliation prevents these powerful companies from determining their own EDI communications destinies. The undeclared intentions of many ECSPs could sway the entire industry, including the outcome of the present antitrust case. Each service provider that makes a move from a VAN to ECGrid as a major client materially sends a message: there is a competitive alternative. The ECSPs are the prohibitive winners in the EDI market, but seem reluctant to assert their collective leadership.
The Basic Principals Governing Competition Among Peer Networks The Network Effect - exploiting network scale to squelch competition
The rudimentary concept of network effects is important in the case at hand5. Networks grown via accretion (buyouts) may eventually encompass such reach, including immense subscriber populations, that they become essential facilities. Without established ground-rules mediating access to these large networks, competition is hampered, or foreclosed upon altogether. Whether such rules are
4eCommerce
service providers like SPS Commerce and DI Central have won the SME supplier market from GXS and the other top 4 VANs. This fact lies at the crux of Loren Data Corps interconnection woes.
5http://www.justice.gov/atr/public/speeches/3889.htm
enshrined in titled regulations, or via informal industry conventions, the goal should be to preserve the climate of competition and fair access. Regulators and industry leaders should work to preserve the positive attributes of connected networks (ability to reach subscribers on any network, ability to use any application), while guarding against the deleterious effects of monopolies exploiting network interconnection access. The cooperative practice of non-settlement peering as the predominant policy of interconnecting ISPs has functioned admirably during the Internets arc of spectacular growth; similarly, EDI networks (VANs) cooperated via collegial, non-settlement interconnection for the sake of maintaining the viability of a growing EDI communications market. Each of these markets mustered resources to create viable legacies of their assumed reliability. As the EDI market experiences its first antitrust action, we can discern a pattern from the often repeated history of connected industries. Network effects have played an integral role in influencing the competitive landscape6 in both markets, however, the differences in routing methodologies and access policies have created contrasting results.
EDIs deficient routing architecture is easily exploited by one bad actor with capital backing
Architectural deficiencies in the EDI routing system made it easy for a dominant VAN (GXS, in this case) to leverage the network effects of rolling up the GEIS, IBM-IE, and Inovis VANs. A brief explanation regarding the differences between the hierarchical routing used by ISPs, and layer 7 explicit path routing of VANs will be instructive:
6Schazebach,
DOJ, et al
7The Border Gateway Protocol (BGP) is the routing protocol used to exchange routing information across the Internet. BGP is the only
protocol that is designed to deal with the Internet's scale, and the only protocol that allows multiple connections to unrelated routing domains.
interconnection denials or striving between ISPs and backbone connectivity providers. Peering controversy's do happen, though, and the FCCs rule-making on network neutrality has made the news. These are exceptional circumstances, and the basic mechanism of replicable routes open to all conforming systems and subscribers has not been altered. The BGP routing system provides for multiple alternate message paths8. An agnostic connection model ensures that any service may connect via ISPs, backbone transit providers, or network exchange points, and freely operate any system while conforming to well published standards. There are exceptions, but these have to do with content specific providers requiring specialized traffic handling (video, high-performance, low latency, etc., and Content Delivery Networks). The most important application to run atop this mesh of hierarchical routes is the Domain Naming System (DNS), the largest distributed, standards-based directory service for converting names to network address numbers. DNS, BGP, and connection agnostic attachement policies have created an economically vibrant ecosystem of businesses, applications, and some would say, the magic of the Intenet.
reform act of 1996. This reform removed the oversight of ISPs and transport providers from the purview of the FCC, until recently, where the final chapter on Network Neutrality has not (yet) been written. VANs currently operate free of common carrier regulations. Although EDI is a replacement for mail, couriers, and wire-line (telex) transactions, the establishment of VANs as agents of bailment has not been addressed. EDI messages are valuable, demand unique handling, and are concerned with tangible trade and the subsequent pecuniary losses due to mishandling or loss of messages in transit - all of these elements enter into the fundamental issues of common carriage, including bailment, and therefore merit consideration when a highly financed VAN exploits network effects acquired via purchase, as opposed to fair competition, innovation, and industry leadership. Supply chains depend on EDI for the transmission of B2B transactions valued in billions of dollars annually. The efficiencies gained are sought after by businesses who are implementing EDI compatible systems in increasing numbers. For many businesses, EDI is required to join a supply chains as a seller / supplier. The last decades twenty-fold increase in EDI enabled trading partners is at odds with the fragile, outdated routing architecture used by all of todays VANs.
A parenthetical note on AS2 direct-connect technology would be appropriate here. AS2 allows trading partners to eschew VANs in favor of non-routed, peer connections. However, AS2 has not addressed the central issues of ubiquitous access to diverse trading communities. As2s adoption within certain industries (retailers, transoceanic shipping, etc.) is symptomatic of a long-term, fermenting trend of dissatisfaction with VANs, on many levels (pricing, poor support, etc.).
It is interesting to note that the most vociferous proponents of AS2 are specialist administrators and engineers who maintain and operate large, closed, AS2 trading hubs. There is no such concomitant advocacy on the part of As2 end users. More can be said on the topic of AS2 being the EDI industrys red herring9. A more fundamental question: Can As2s attributes of autonomy and self-management adapt to the ondemand, infrastructure as a service market, sharing the beneficial features of VANs, i.e. as a workable component in the widely interconnected global commerce marketplace, and as ubiquitous as modern email systems? Thats a question worth answering. And, as it turns out, EDI adoption by small and medium enterprises (SME) exacerbates the fragile nature of an aging, primitive 1-1 routing structure. VANs have created a system ripe for anti-competitive abuse, as a default condition of non-innovation. In its Lawsuit, Loren Data Corp charges GXS with violating the Sherman and Clayton acts by intentionally exploiting weaknesses in the VAN routing and ID migration systems. The converging forces of 1) EDI market adoption, 2) bad routing / weak network architecture, and
9AS2
is a stand-alone, end user installed protocol adapter. There are few examples of successful add-on adapters that
enjoyed wide popularity among the a diverse cohort of small and medium businesses.
3) entry of B2B electronic commerce service providers, have collided in a massive wreck. Trading partners, the end users of the network, cannot take their business elsewhere due to lack of ID portability10, and competitive EDI communications providers cannot be assured of access to the GXS leviathan. Competitive providers shall simply wither if GXS does not bless their Interconnect. That is precisely how AT&T cemented its monopoly - via the capital of J.P. Morgan and the technique of interconnection arbitrage.
EDIs closed paths - not good for competition in an Enterprise 2.0 world
VANs are closed messaging systems working at the application layer, so while VANs can move to other transit providers, they retain control over their users EDI messaging traffic. Consolidation and rapid changes among a few key competitors offers little hope that VANs services repertoire will include directory services or ID portability anytime soon. This seemingly well ordered system is paid for dearly, at the cost of the trading partners suffering such built in deficiencies. The sub-par routing and lack of directory services have impeded end-user freedoms and delayed the adoption of new technologies. If the reader has doubts regarding these important issues, please consider the following: It was simply a matter of time until one VAN deployed sufficient capital to purchase control of the largest subscriber ID pool in the EDI industry, making the GXS bundle of VANs11 must have routes. Agencies allowing GXS to persist in committing Interconnection arbitrage are establishing an industrywide precedent for even more problematic behavior - when GXS has eliminated most alternative EDI providers.... Questions regarding intent are largely philosophical. However, any analyst or professional with a broad view of our industry can speak to the truth of the current situation: 1. GXS is now, in effect, a monopoly. The companys decisions on interconnection determine the fates of its competitors - an enviable perch for an AT&T style monopoly of the 21st century. 2. GXS is a required route. The present VAN routing regime offers no alternatives. 3. GXS has purchased its user population with a bias towards the largest supply chain members, becoming a numerically large, must-have network path for all smaller12 trading partners. 4. GXS has periodically refused peer access to competitors, forcing paid transit or retail service arrangements13. 5. Loren Data Corp, a network optimized for on-demand cloud commerce, is simply the latest, most egregious example of GXS interconnection arbitrage. GXS is unhappy that Cloud
10Without 11TGMS, 12smaller 13The
great inconvenience - one or two IDs, fine, an entire user population, very difficult. IE, Inovisworks and Tradanet, in current EDI parlance could mean suppliers with gross revenues between 10M-250M.
State of MI introduced legislation to prevent VAN interconnection refusals (by GXS) to sabotage the supply chains that are so import to the automotive industry.
Commerce Service Providers are competing successfully for mid market B2B EDI users.
6.
Loren Data Corp ECGrid is the preferred network for certain on-demand commerce providers; GXS expresses its institutional displeasure via interconnection denial, degrading services, and interfering in ECGrid inter-network administrative operations. 7. The success of electronic commerce service providers has caused GXS to strike peremptorily at a communications network favored by these service providers, ECGrid, operated by Loren Data Corp.
Enterprise 2.0 and EDI - dancing while the matchmaker is under assault
Ubiquitous web access has fostered the growth of Enterprise 2.0 applications, such as Salesforce, Freshbooks, and many other on-demand variants of ERP, CRM, and accounting self-service applications. Finally, small, medium, and even tiny businesses can engage in automated ecommerce. Subtle differences may currently exist between service providers in the classic EDI supply chain and Enterprise 2.0 applications, but the divergences are cultural rather than substantive, centering on a trading communitys work flow models and methods of access. Some of the more ambitious web applications for supplier ecommerce, logistics, and inventory management, have tried to take the sting out of EDI implementations. The pitch may take the form of an anti-VAN-anti-EDI slant, but the common motivation is to quickly enable B2B data exchange between partners. To get there, we need to augment web application innovators with savvy messaging system innovators, i.e., network scientists. Transport level innovation has been dismally absent in the EDI industry, unfortunately. As a class, the Value Added Networks have focused almost entirely on the data translation and integration processes;
important as these are, translation is not as essential to the Enterprise 2.0 model. Interfacing with trading partners on VANs (with weeping and gnashing of teeth) is an adjunct service of modern trading hubs, not a central service. Until there is a new revelatory architecture embraced by classic B2B supply chains and the Enterprise 2.0 models alike, we will be at the mercy of a fragile and aging EDI routing architecture. The pain stems from a lack of credible communications science adept at enabling transactions across the entire spectrum of VANs, eCommerce Service Providers, and direct connections. The creation of such a services requires vision and research plus the taking on of substantial risks. If the new B2B innovators seeking anchor in Enterprise 2.0 are continually squeezed by a hostile GXS holding its network boundaries hostage, then a final sad chapter will be written in the history of electronic commerce, followed with an epilogue signed by Francisco Partners, LLC.
Safeguarding alternative EDI innovators is the best strategy in the regulators playbook
The network that enabled leading-edge B2B providers is Loren Data Corps ECGrid. The mere existence of this robust competitor, delivering advanced communications, APIs, and tailored support for the B2B cloud operators, has kept the growing GXS MegaVAN barely in check, retarding the markets surrender to a hostile monopoly. But, the survival of any small competitor is by no means assured. If GXS remains unfettered to arbitrage interconnections to its network, the game is over, and there are precious few to take up the gauntlet. The act of denying interconnections allows GXS to push powerful users (service providers) towards its own networks; when GXS delays inter-network administrative tasks (subscriber moves, verifications, etc.), this distorts the industrys perception of those competitors that GXS wishes to disadvantage. Such is the unbalanced, unchallenged power of an actual monopoly.
would a company with 400MM in revenue risk antitrust action by a plaintiff with less than 1MM in revenue?
However, the legal response would be for GXS to innovate, compete, and grant fair, peered, nonsettlement interconnection to Loren Data Corp ECGrid or other bona fide EDI operators, and may the best networks win. After all, GXS currently grants interconnects to dozens of VANs that it deems nonthreatening15. As an important side note in the present case,while GXS is denying interconnection to ECGrid (a dedicated communications facility), Loren Data Corp does not otherwise compete in any other B2B related software or services, integration consulting, or other competitive sectors crossing GXS revenue lines. GXS Executives must earnestly believe that disadvantaging Loren Data Corp will preserve their grip on the B2B industry, otherwise, why else would this +400MM corporation instigate such egregious actions, if the threat was not so palpable? Such value judgements have no place in connection dependent markets where one participant has availed itself of hundreds of millions in private equity to buy its way to the top. Therefore, the plea is that Great Britains OFT, and our domestic FCC, FTC, and DOJ, implement stabilizing measures to ensure the vitality of the EDI Communications sector: Order fair interconnect access, ala the RIO16 model pioneered by ITU Apply such standards to VANs holding or deploying reserve private sector equity Consider defining size limits, measured by the number of trading partners, revenue, and trading partner weighting in the supply chains they occupy. Offer a period of voluntary compliance, reinforced by inspection and review. If the probationary networks violate, impose administrative requirements to order reasonable interconnection policies. Consider Facilitating Industry Interconnection Exchange Points, similar to CIX that allowed the Internet to flourish
The author and principals of Loren Data Corp are available for comment on the above issues. Alan D. Wilensky, Analyst Bizquirk 412-353-9269 abmadw@gmail.com
15GXS
has granted interconnection to most VANs that are clones of its own model. That Loren Data ECGrid serves the Web Application sector as an interconnect management provider is uncomfortable to the ecommerce giant.
16Reference
Interconnect offer: a standardized policy governing fair network access policies that protect both sides of the
interconnect.
and Inovis works will be rolled into a unified commercial agreement. This is occurring while GXS grants non-settlement peering to most other VANs. It is precisely to bar companies, like NetEDI, from accessing the global EDI communications system (on an equal footing), that GXS is interfering in ECGrid Network operations, interconnection denial, and denying existing contractual agreements).
3. Costs for end-users to move away from a GXS VAN at the end of a contract. (Please note: A major UK EDI Service Provider was recently strong armed into a new contract by GXS under the implied threat of disconection or service interruption, we hope that this service provider takes our advice and contacts OFT).
Obstructive Nature of GXS The concern is that GXS operates TGMS, Information Exchange, Tradanet and Inovisworks in the UK, wielding the power to restrict EDI interconnects to alternative providers (Loren Data and NetEDI) thus preventing them from competing on equal terms. Tradanet is the main VAN used by the major retailers in the UK (e.g. Tesco, John Lewis, Boots, Marks and Spencer's, etc). All of the suppliers allied with these top retailers need to communicate over Tradanet in order to trade freely. Although there are alternative VANs, the crux of the matter is that GXS may restrict trade by simply obstructing interconnections (arbitraging), or by acting slowly in executing interconnection, user initiated migrations, and other proforma administrative action items. GXS has a hold on the large retailers, while smaller EDI providers (including transaction networks like Loren/ NetEDI) specialize in the smaller suppliers and buyers on the smaller end of the traditional supplier base. Small to mid suppliers need EDI as a condition of trading with the larger retailers. Therefore, these SMEs seek out more accessible and cost-effective alternatives via competitive EDI Service Providers - often therse innovators offer on-demand web based applications models. GXS holds the keys to accessing major retailers, and the ultimate survival of alternative networks has been placed in jeopardy by the leverage GXS has gained via access to private equity. Supplier are being directed (as a requirement) to trade electronically. These SME class naturally gravitate to alternative EDI providers, who then must gain interconnects to one or another GXS VAN. GXS obstructs and delays requests made by the users competitive network, (or institutes a punitive fee structure). From the perspective of a supplier, these setbacks are their new EDI providers fault, therefore, they play it safe, and switch to GXS, but pay a much higher price for the service. Does this comport with regulated services? No, but are there valid comparisons?. if a Vodafone restricted access to other mobile networks or classes of subscribers, and blocking inter-network connections in the midst of acquisitions this is effectively what GXS is doing restricting access to the largest and most powerful class of EDI enabled retailers, trading partners gained via access to private equity, and selectively blocked or allowed to other networks (classes of users) via the opaque calculus of interconnection denial (arbitraging). Client migrations from GXS to other networks We have a specifically documented case whereby GXS intentionally obstructed a client from migrating from Tradanet UK to NetEDI. GXS Tradanet used delaying tactics, charged high penalties and additional fees to the migrating subscriber. The sum of these anti-competitive practices caused the end-user to reluctantly remain on Tradanet. A documented timeline of this specific case is attached, and there are others. This has had an enormous impact on NetEDI/Loren Data Corps reputation in the UK, and has restricted both companys ability to compete with GXS - even if remedies are forthcoming via legal or regulatory means, it remains to be seen whether any EDI provider can recover its reputation sufficiently to regain market position, EDI being so crucial to line of business operations (as a subtle taint remains). Costs of data transfer GXS is the only EDI messaging service that has halted the inter-VAN system of permissive, collegial interconnections, charging for the transfer of data into their Network. Sterling, Easylink, and other VANs have readily, for years, interconnected with Loren Data Corp ECGrid. GXS, has, however, conducted a decade long campaign of denying interconnection to ECGrid, except for interconnects belonging to the two networks is has acquired: IBM IE, and Inovis, where Loren Data Corp ECGrid is bi-directionally peered. But, as GXS has intentionally not unified its acquired VANs, they remain as islands to ECGrid, and therefore, to NetEDI and other UK EDI Service providers desirous of alternative, innovative, and competitive EDI message transit services. GXS is the heavy weight in the UK market, holding key assets , i.e. major retailers who require suppliers to trade
electronically. Therefore the ultimate formula is quite simple from a GXS perspective: Have all partners on GXS, or on the VANs we preselect for interconnection. Opinions on the OFT Findings and Report on GXS / Inovis merger The OFT report states GXS and Inovis do not operate UK Data Centres; while true, this does not mean that the equivalent functions are not used within the UK. Geography simply does not figure prominently in messaging services, such EDI routing. What does matter is the size and weight of the connected clients residing on a particular VAN. The larger and more influential trading partners occupying top slots along the Supply Chain (e.g. Tesco), confers all the more leverage that GXS can wield, as they do, with a none-to-subtle hand. For reference the OFT report I am referring to is http://www.oft.gov.uk/shared_oft/mergers_ea02/2010/GXSInovis.pdf RE: Paragraph on data centres is quoted below for reference: 43. The OFT considers that in this case it is possible that the geographic boundaries of the upstream market for EDI messaging infrastructure are wider than the geographic scope of the market for EDI messaging services. In particular, the OFT notes that neither GXS nor Inovis have data centres in the UK (nor indeed do some of their competitors such as Sterling Commerce). However, the OFT does not need to conclude as to the precise scope of the geographic market for EDI infrastructure as its competitive assessment does not change on any plausible candidate geographic market. Point 78 of the report also states that Freeway rented EDI messaging services from GXS, which is partly true, however, they also used BT messaging services as well. Apportioning subscriber services among multiple backbone networks is prudent, with the caveat of availability of interconnections, as discussed above. The use of multiple EDI backbone networks does nothing to solve migration issues. Point 95 concludes that costs related to switching EDI messaging providers are not particularly high and do not restrict competition; the attached document details a case where the converse is true and there are several such cases (having occurred before and after the Inovis merger), awaiting the further solicitation of aggrieved parties by the various regulators. Point 109 in the OFT report above, states The OFT has no evidence that the post merger firm could credibly commit to refusing access to EDI infrastructure, because resellers could turn to other suppliers of EDI infrastructure. Indeed, the OFT notes that resellers [ ] multi-source their infrastructure from a number of providers. The above surmise is entirely mistaken. Although providers may avail of varying components of an EDI infrastructure via alternate or supplementary providers i.e. mailboxes, translation systems, etc., the requirement for interconnection to the GXS VANs is absolute for gaining access to the large retailers and other top slotted trading partners homed on Tradanet, TGMS, IE, and Inovisworks. EDI infrastructure needs to be fully meshed at 1:1. This is exactly analogous to clients on one Mobile network not being able to connect to subscribers on another network. The restriction and architectural deficiencies confounds competition and damages smaller EDI providers in their ability to compete with the larger providers, and most notably, the one provider breaking the EDI industrys long standing practice of granting collegial interconnections. Stated throughout the OFT report is the assumption that switching EDI communications providers is trivial. This assumption holds true only if all VANs follow consistent interconnection practices, no matter how informal. GXS is simply exploiting interconnection in order to influence the market#. The attached document illustrates the present example. Presently, only GXS charges for the privilege of subscriber migration. The overall industry wide practice of locking clients into contracts and pressuring to renew before the natural occurring end of agreements is symptomatic of an ailing industry on the verge of price war leading to unsupportable service levels. Finally Point 93 of the report states: ...some of the parties' competitors are marketing the ease with which firms can switch providers....
Although NetEDI is referenced (in a news item about the GXS / Inovis merger), stating the ease of switching, it is the commercial impact of the delaying and interfering tactics employed by GXS that cause such migrations to be troublesome or costly. In the referenced case, GXS was extraordinarily intransigent when called upon to assist in executing a customers wish to to migrate from GXS to ECGrid (NetEDI). NetEDI was mentioned in the report, more than once, to provide a justification that competition does exists in the UK EDI Communications services sector. In fact, NetEDI only began operations in April of 2010, as such, should probably not have been used as a competitive reference. NetEDI had only 5 customers at the time of the reports release!
Additional instances of this file of administrative interference in expanded form is available Example: This is an excerpt from a long email thread demonstrating tradanet UK (GXS) denying a contractual route from Inovisworks (a GXS Company, which Loren ECGrid has a contract with), to ECGrid:
From:Todd Gould [mailto:tgould@ld.com] Sent: Thursday, October 28, 2010 11:17 AM To: Rob.Minns@gxs.com Cc: awilensky@ld.com; john.staunton@inovis.com; shelleyd@ecgrid.com; customercare; Electronic_Trading@johnlewis.co.uk; andrius@qualita.co.uk; Crystal Kuczynski; Steve Brewer; lakeisha.jones@inovis.com; vicki.nielsen@gxs.com Subject: Re: Request EDI guides for John Lewis PLC Importance: High Dear Mr. Minns: I appreciate that you are in a difficult position in regards to instructions are you being given from Gaithersburg on how to deal with Loren Data. Perhaps I can put this in a perspective that will work for both of us. We have a commercial contract for VAN services from Inovis. It contains no exclusions to any particular interconnects. It allows us transit to any interconnects that InovisWorks has, not only TGMS. If other Inovis customers have interconnect traffic with Tradanet, then we have a valid commercial contract for services to interconnect to Tradanet. Perhaps the path we were told does not exist and data should be routed another way. It makes little difference to me the path it takes within GXS as long as the data goes through between trading partners. What I need you to do is allow the interconnection between your Tradanet customers and your Inovis customer (us) to be started immediately. I strongly urge you to not block the valid EDI communications between your customers and not interfere with transaction of international commerce. The only people being hurt by these actions are your customers and their trading partners. I really don't believe that GXS is in business to prevent electronic commerce between trading partners. Thank you for taking care of this as quickly as possible. Regards, Todd Gould President Loren Data Corp. tgould@LD.com From:Rob.Minns@gxs.com [mailto:Rob.Minns@gxs.com] Sent: Thursday, October 28, 2010 6:14 AM To: john.staunton@inovis.com; shelleyd@ecgrid.com; customercare@covalentworks.com; Electronic_Trading@johnlewis.co.uk Cc: andrius@qualita.co.uk; crystalk@ecgrid.com; SBrewer@covalentworks.com Subject: Re: Request EDI guides for John Lewis PLC
John is correct. There is no commercial connection from Loren data into Inovis works and then interconnecting into Tradanet. We have explained this previously to Loren Data representatives. We formall ask Loren Data and their representatives not to make requests with this intent in mind and please don't set expectations with your prospective customers that it is a commercially available service.
Where OFT and others erred in gauging the availability of communication alternatives
The OFT (and USA agencies) were unaware of the 1:1 routing authority of VANs. VANs are not IP pure transport systems, but are messaging systems at Layer 7, with routing boundaries that are inviolable, where alternatives simply do not exist. Therefore, EDI industry requires an Industry Exchange Point, otherwise known as a NAP (Network Access Point) to normalize access across VANs, provide ID portability to end-users, and to additionally insure fair competition for the smaller, specialized service providers17.
17EDI
service providers distinguished from VANs, do not maintain their own, naively peered interconnects.