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The pursuit of industry online

Trade publishers are hoping that updated technology and new business models will allow them to succeed with online directories.

A year after former Lotus chief Jim Manzi's Nets Incorporated sputtered and crashed, new efforts to tap the huge market for industrial products are emerging.

Trade publishing companies that serve engineers and manufacturers of such products as valves, electronic components, adhesives, sealants, bar code scanners, and the like are hoping that updated technology and new business models will allow them to succeed where Manzi's efforts failed.

Next week at the National Manufacturing Week trade shows in Chicago, Thomas Publishing will unveil Product News Network (PNN), an ad-supported site with advanced search capabilities to help engineers locate new products.

"Thomas is definitely one of the publishers in a key position to leverage the content they have and the relationships with advertisers and buyers," said e-commerce analyst Torrey Byles of Granada Research. "But they need to do something that is value-added. Otherwise the ghost of Nets Incorporated will come back to haunt them."

Manzi's company, which filed for bankruptcy last May, took over an industrial mall called Industry.Net, tried to reposition it, and went broke when Manzi tired of underwriting its losses. Industry.Net originally was supported by fees from hosting suppliers' Web sites and catalogs, but Manzi wanted to add online purchasing of routine items such as office supplies, PCs, and travel services.

Thomas, with 100 years' experience in publishing directories and magazines for the industrial sector, isn't the only trade publisher moving into the online directory space. At next week's manufacturing trade shows, Cahners Publishing will announce a similar joint venture with Aspect Development for manufacturers. Details remain sketchy for that project, which is due to launch in June.

Aspect has another joint venture with technology publisher CMP Media called Electronics Design & Technology Network (EDTN), a news and product site for electronics design engineers. EDTN is largely ad-supported but also has subscription areas.

In addition, I.D. Magazine (International Design) and Crain Communications' Plastics News use Supplybase technologies to create online supplier directories for their magazines. SupplyBase also runs its own industrial marketplace of product-development vendors, called DeveloPages, and is offering its technology to trade publishers to set up supplier directories online.

The new generation of industrial sites have learned from Manzi's failure--indeed, the Industry.Net site still operates, now the property of Information Handling Services Group (IHS), a publisher of electronic information databases with $360 million in annual sales. IHS Group, which charges subscribers several thousand dollars per year to use its online product databases, intends to use Industry.Net as a free service that will draw nonsubscribers to use its proprietary databases on a pay-per-use basis.

Product News Network's emphasis--for now--is on selling ads to keep its site free to users.

"We are an advertising sales division of Thomas," said PNN publisher Keith Kreisher, whose group is part of Thomas's magazine division. "We've been doing that for a long time."

Still, PNN isn't ruling out transactions in the future. "We have no current plans to [add online purchasing], but it does look like a good system to build that into," said David O'Connor, marketing manager for the site. His analysis: Industry.Net failed in moving to online purchasing because it was ahead of its time.

Not all of Thomas Publishing shares that perspective, however. The parent company is in a high-profile joint venture with GE Information Systems (GEIS) for a system called TPN Register, which runs the Trade Process Network. TPN melds industrial catalogs under 55,000 product headings from Thomas and online purchasing using electronic data interchange technology from GEIS.

In the last year, a change in the business-to-business Internet commerce space has opened new opportunities for industrial marketplaces.

The hottest sector of interbusiness Net commerce today is for automating online purchases of nonessential products, particularly by manufacturers.

"In the procurement automation sector, there is a need for content aggregators and brokers who can build content from multiple suppliers and vendors and standardize it," said David Alschuler, an e-commerce analyst at Aberdeen Group.

Many software packages that automate a company's purchases of office supplies, repair services, PCs, travel, and temporary employees, pull from multiple vendors. That requires updating of a company's internal catalog with data from several suppliers.

"If you can build a database of similar suppliers, then you have a valuable database for procurement and purchasing," Alschuler said.

Aspect Development is straddling both sides of that sector. Aspect markets software for buyers to automate certain purchases online, but it also has content for certain types of catalogs, including so-called MRO purchases (maintenance, repair, and operations) and electronic components.

In addition, it recently bought Cadis, which markets parametric search software being used by Product News Network, TPN Register, and others.

If Industry.Net is the progenitor of these online catalogs and product search sites, there is some irony in the timing of Product News Network's launch by Thomas Publishing: Last month, another Thomas division, Thomas Regional Directory, settled a copyright infringement lawsuit against Industry.Net.