Sabre Holdings Corporation (NYSE: TSG) and Ariba, Inc. (Nasdaq: ARBA) today announced a definitive agreement to create Sabre e-Marketplace(SM), the first Internet-enabled B2B marketplace designed for the travel and transportation industry. Powered by the global Ariba(R) B2B eCommerce platform, Sabre e-Marketplace is expected to drive cost savings and new revenues for industry participants through global economies of scale and streamlined buying and selling.
Sabre e-Marketplace will maximize the purchasing power of companies with similar procurement needs, such as airlines, airports, more than 45,000 Sabre connected travel agencies, railroads, 10 cruise lines, 50 car rental companies and 45,000 hotel properties. This collective buying power will be strategically managed by Sabre, combining process efficiencies to help buyers realize an estimated 10 to 15 percent savings for the anticipated products and services they need. Sabre e-Marketplace is also expected to increase revenue opportunities and efficiencies for suppliers by providing a streamlined, single point of access to many buyers. As an example of the magnitude of this service, the airline industry spends US $50 billion annually on goods and services.
Sabre plans to fully leverage existing relationships with some of the world’s largest travel suppliers along with its unmatched industry expertise to make Sabre e-Marketplace the largest and most comprehensive procurement site in the travel and transportation industry.
“As consultants to the travel and transportation industry, Sabre has extensive insight into the needs of our customers,” said William J. Hannigan, chief executive officer and president of Sabre. “Sabre e-Marketplace customers benefit from using the comprehensive capabilities of the proven Ariba B2B eCommerce platform to generate cost savings and revenues, as well as leverage Sabre’s ability to integrate this service into many of our existing products and services. That’s Sabre doing what it does best, delivering unsurpassed value and leading technology solutions.”
“Sabre’s extensive domain expertise, reach and IT experience in the travel and transportation industry make it ideally positioned to bring buyers and suppliers together to achieve enormous economies of scale,” said Keith Krach, chairman and CEO of Ariba. “The global Ariba B2B eCommerce platform will provide Sabre and its customers with a fast time to transactional liquidity and a full range of proven commerce services from procurement to supplier enablement to dynamic trading services.”
Sabre will use the Ariba B2B eCommerce platform, the industry’s most comprehensive, open, global platform for B2B commerce, to build Sabre e-Marketplace. This includes Ariba B2B marketplace solutions, Ariba IBX(TM) marketplace services, Ariba Network(TM) commerce services, the Ariba ORMS(TM) B2B procurement solution and Ariba ORMX(TM) B2B hosted procurement services.
Additionally, Sabre will use the Ariba B2B procurement solution with its global supplier base, aggregating and directing its own annual spending into Sabre e-Marketplace to accelerate marketplace transactions. Ariba and Sabre will share in ongoing transaction-based revenue streams from Sabre e-Marketplace.
Sabre e-Marketplace is planned to give participants a single procurement portal through which they can buy and sell goods and services from capital equipment to cabin services to ticket stock, as well as conduct auctions for sourcing and selling surplus materials such as aircraft parts. Through the use of the Ariba B2B eCommerce platform, Sabre e-Marketplace is expected to provide participants a full range of services to drive market and process efficiencies, such as:
Multi-level approval and routing workflow
Reporting and analytic tools
Content and catalog management tools
Sophisticated dynamic pricing capabilities (auctions and reverse auctions)
Back-end integration to enterprise resource planning system
In addition, Sabre e-Marketplace is planned to provide information and news related to the industry, integration of Sabre e-Marketplace into existing Sabre applications and other value-added services.
To help larger buyers capture and efficiently manage enterprise-wide spending and procurement processes, Sabre and Ariba will jointly market and promote the Ariba B2B procurement solution and Ariba Network commerce services to the Sabre customer base. Additionally, Ariba will refer its travel and transportation industry customers to the Sabre e-Marketplace.
The first phase of this new B2B marketplace is expected to launch in early third quarter 2000 with Sabre contributing technical and business expertise and resources toward the development, installation and activation of Sabre e-Marketplace for travel agencies and small- to mid-sized airlines. Sabre will also provide resources to build, manage, market and sell the new portal. In an effort to provide community participants easy access to the Sabre e-Marketplace, Sabre will also develop vertical B2B applications linking the company’s comprehensive software portfolio adding value to its customers not available from other procurement communities.