At the risk of soliciting conversions to a potentially false creed, we offer a primer on Web services--what they are, what you need to know to be conversant with the underlying technology, and why, in the end, you may decide to pay closer attention as they evolve.
Simply put, Web services are business and consumer applications, delivered over the Internet, that people can select and combine through almost any device from personal computers to mobile phones.
What will it take for this vision to materialize? The substantial investments in Web services that players such as IBM, Microsoft, and Sun Microsystems are now making have convinced some observers that this technology will soon be a reality. Others point to the significant remaining hurdles: Key technical standards still haven't been finished; specific services and new service providers have yet to be defined; and, perhaps most important, questions such as consumer privacy and security remain unanswered.
Despite these obstacles, new and potentially powerful innovations are building behind the buzz.
Web services not only promise consumers a more consistent and uniform experience but also allow them to integrate and personalize data and services from diverse sources.
Although some aspects of the technology (such as security) are still maturing, Web services implement the client-server model over the Web. On the client side, for example, they manage the different screen shapes and sizes and the different connection speeds of desktops, mobile phones and PDAs. On the server side, the different programming languages and middleware technologies at work behind each application or data source become transparent to programmers, thus making it a lot easier to develop applications.
To give people easy access to any number of Web sites and services--through a variety of devices and in a variety of roles (for example, that of a customer or an employee)--passwords and other user information will be stored in the form of Universal User Profiles (UUPs).
Each of these UUPs probably will be stored with a service provider (such as Microsoft.Net Passport or AOL Magic Carpet). Once people have registered with a provider, they would own this "sticky" information, at least nominally, and other Web sites and services would be allowed to interact with them. To succeed, service providers would have to win the trust of consumers and online partners--no easy task.
Savings of up to 20 percent are possible, mainly through reductions in the cost of developing interfaces among systems.
Web services will cut the amount of time and money needed for systems integration, the single biggest IT expense of most companies. Savings of up to 20 percent are possible, mainly through reductions in the cost of developing interfaces among systems. Systems integration firms may not need to worry, however, since an increase in the volume of integration projects could offset the reduction in unit costs.
Web services, relationships
When and if Web services reach their full potential, they will change the way many companies do business. Reduced transaction costs will encourage the outsourcing of noncore functions through electronic links with key partners. The likely result: increased fragmentation of value chains and industries as well as more narrowly focused companies.
For online business-to-consumer companies, customer relationships will be affected dramatically. E-tailers, e-mail services, financial-service providers, and other kinds of B2C companies stand to lose out to Universal User Profile providers, which could control access to customers. As consumers dealt directly with their UUP providers, companies without strong brand names or reputations could be relegated to the virtual backwaters.
Web services and the associated development tools are in their infancy and still show more promise than results. Some key standards--most crucially, those involving the releasing of Universal User Profiles--remain unresolved. UUP providers must ensure the privacy and security of the users' credit card and other sensitive information, for example, while allowing access to all those (and only those) businesses that provide requested services. In addition, businesses interacting with each other must be able to specify the appropriate level of service promised to each user.
If past patterns hold, the future of the technology--boom or bust--will become apparent over the next 12 to 18 months. Meanwhile, companies would do well to think about a number of questions.
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