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Stock Analyst Update

B2B for the PC Industry

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Business-to-business (B2B) e-commerce just took another giant leap for humankind. On Monday afternoon, a consortium of 12 major technology-equipment makers and component suppliers announced the formation of an independent firm geared to create one of the largest online marketplaces to date.

The new company, which has not yet been named, is intended to drive enormous cost savings among computer makers and suppliers. In theory, direct online relationships should allow all of the firms involved to produce their products cheaper, hold less inventory, and quickly exchange valuable information about supply and demand. Compaq’s (CPQ) president, Michael Capellas, estimated that the online exchange could reduce operating costs by between 5% and 7%--not chump change in a multibillion-dollar industry. That a motley group of competitors and suppliers could come together in just three weeks is evidence of the opportunities for all involved.

Jeremy Lopez does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.