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BellSouth in online B-to-B
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February 23, 2000: 3:07 p.m. ET
Joint venture with Commerce One will create digital equipment marketplace
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NEW YORK (CNNfn) - BellSouth announced on Wednesday a business-to-business venture with Commerce One to market digital telecommunications equipment to small businesses over the Internet.
The Atlanta-based baby bell, which has 37 million customers worldwide countries, plans to create an online exchange whereby telecommunications companies can buy digital equipment through six or seven vendors, BellSouth said.
BellSouth (BLS: Research, Estimates) and Commerce One (CMRC: Research, Estimates), a Walnut Creek, Calif.-based provider of online business solutions, will each hold a minority stake in the new company.
BellSouth hopes to build on the goods and services that its 1.2 million small-business customers buy each year by providing one place for them to buy all their digital telecommunications equipment. Also, by allowing customers direct access to vendors the equipment will cost less, the company said.
For example, a startup Internet service provider that needs to buy routing equipment can log onto the exchange site and buy the equipment directly from one of the vendors rather than having to first go through BellSouth.
The agreement is part of BellSouth's plan to transform its $16 billion global supply chain and reduce operating costs by $1 billion over the next two to four years, the company said.
"Our idea is to set up a truly open and independent company from BellSouth that will attract all of the trading partners from across the telecommunications space," said Pat Shannon, president of the new BellSouth Exchange Service.
BellSouth is currently negotiating with different vendors who hope to sell their equipment on the new site.
"BellSouth truly understands the power and potential of global electronic trading communities," said Mark Hoffman, president and chief executive officer of Commerce One. "Our leadership in e-commerce combined with BellSouth's tremendous operational expertise and e-business commitment add a major new marketplace to the Commerce One Global Trading Web."
Wednesday's announcement marks the second such exchange for BellSouth.
Previously, the company announced plans to develop an exchange in which small businesses throughout the company's nine-state region can buy traditional office phone systems and equipment through Commerce One. Both sites are expected to complement one another, Shannon said.
BellSouth shares were down 1-1/16 to 38-15/16 in midday trading Wednesday. Commerce One shares were up 11-3/8 to 184-3/8. 
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Commerce One
BellSouth
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