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Microsoft to offer e-business tools

The software giant plans to release a new program designed to help small companies route and process purchase orders, invoices and the like over the Web.

Microsoft plans to release in June a new software program designed to help small companies route and process the mundane paperwork of business--purchase orders, invoices and the like--over the Web.

Microsoft discussed the new product, called Microsoft Business Network, at its Convergence conference in Orlando, Fla., on Wednesday. The new program, which requires that Microsoft Office be installed in order to run, is intended to help companies with less than 1,000 employees lower administrative costs and errors by reducing data-entry tasks, Microsoft said.

With the introduction of Business Network, Microsoft enters the treacherous "business-to-business" e-commerce software market. Numerous software companies, such as Commerce One, Ariba, PurchasePro and VerticalNet, pioneered that market in the late '90s and were burned by the flameout of the dot-com mania. Their names are synonymous with the failure of many so-called online marketplaces, electronic bazaars for business supplies, that they'd set out to create.

Microsoft has no intention of replicating its mistakes with its new product, said Marcus Schmidt, a lead product manager at the company. Instead, the software giant aims to sell businesses the tools to set up their own trading networks based on open Internet standards, such as the Extensible Markup Language (XML). Using the program, companies can exchange business documents such as invoices and shipping notices over the Internet, instead of by fax, Schmidt said. Microsoft Business Network also supports proprietary business formats, such as Electronic Data Interchange, and can be made to automatically transfer data to backend order and accounting systems, Schmidt said.

Microsoft has not yet released the price of Business Network, initially available in North America, Brazil, Mexico and Argentina. However, the cost will include a combination of software licensing and recurring subscription fees, Schmidt said. The new program comes out of Microsoft Business Solutions, a unit that the Redmond, Wash., company recently formed from the acquisitions of Great Plains and Navision. The group focuses on selling business-management applications to small and midsize businesses, competing with SAP, Oracle, PeopleSoft and Best Software, among others.

At Convergence, the company also discussed plans to release Web portal software, designed to let employees access data and business applications from a Web browser. In addition, Microsoft announced updated versions of its Great Plains and Solomon lines of financial applications.