Microsoft unveils new e-commerce strategy

The aim is to "enable e-commerce for a million new businesses" on its MSN service via a revamp of the company's software line.

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Microsoft is revamping its Web commerce software line and adding new services for consumers and small businesses to its MSN portal, in a dual strategy aimed at strengthening its position as an e-commerce technology provider.

The software giant today acquired CompareNet, a San Francisco company that provides product databases and comparison shopping information for Web sites. CompareNet will be integrated into Microsoft's Sidewalk city guides, adding another 1.5 million unique visitors per month, Microsoft said.

"Our goal is to enable e-commerce for a million new businesses," said Microsoft chief operating officer Robert Herbold, who pinch hit today at a news conference in San Francisco for Microsoft's No. 2 executive, Steve Ballmer, whose wife recently had a baby. "We think we can really have this impact."

Microsoft's new Passport service, based on technology acquired last year with Firefly Network, combines a secure electronic wallet, Web site registration system, and single sign-on that consumers can use on its MSN portal and third-party sites that license the technology. Microsoft will require Web sites that offer Passport to have their privacy policies certified by TRUSTe and the Better Business Bureau Online as part of Microsoft's emphasis on the importance of personal privacy for consumers.

Other new services for small businesses include Web site building and hosting. As it does with stores in its Sidewalk local sites, Microsoft will host the storefronts although retailers also can have an ISP handle hosting.

Microsoft is also revamping its back-office software for Web commerce. A new component is BizTalk, which enables businesses of all sizes to integrate e-commerce applications and share data, serving as a framework for the many pieces required to do commerce online, said Herbold. It is based on eXtensible Markup Language (XML).

"Ideally, it's the Lego blocks idea for e-commerce," Herbold said.

The BizTalk Server extends the capabilities of Microsoft's Site Server Commerce Edition 3.0, which will be renamed Commerce Server with the next upgrade. Commerce Server will ship shortly after Windows 2000, Herbold said. Windows 2000, which has been delayed by more than a year, is supposed to ship later this year.

Companies endorsing the BizTalk framework include Peoplesoft, which will integrate Microsoft technologies into the Peoplesoft Business Network, an "enterprise portal" that is set to launch later this year.

Ultimately, Microsoft will try to glue together its traditional software offerings with its new BizTalk technology, label the resulting products e-commerce, and link them to its consumer-oriented portal. It's an ambitious vision made even tougher because it adds an element no other portal has yet--its own online retail businesses such as travel agency Expedia and car site CarPoint.