In other words, there's no such thing as a free lunch? (Oh No! Say it ain't
so!) ;^)
Michael Burbury wrote:
> Hi there all,
>
> I would like to offer some alternate thinking of this item by offering the
> NULL and ALTERNATIVE Hypothesis.
>
> The Null Hypothesis:
>
> "Using the Internet to transact business documents is cheaper than using a
> VAN."
>
> Of which the Alternate Hypothesis is:
>
> "Using a VAN is cheaper than using the Internet to transact business
> documents."
>
> Now, the discussion begins.
>
> Assuming I already use a VAN, $200K can get me ALOT of transactions (about 6
> years worth on an average 800lbs gorilla). Remember I am only looking at
> the cost associated with the price of the actual transaction, not what it
> costs me to build the transaction or to communicate the transaction. If I
> use the Internet, I still need to build the transaction and still need to
> communicate it. So the cost associated with making and communicating the
> transaction will roughly be the same. IE: the software that maps the data
> to a transaction and the communications links to move the data to/from
> trading partners.
>
> Now, using the Internet, I would need a dedicated communications server that
> is capable of delivering the transactions reliably to my trading partners
> (using whatever technology). Using a VAN, the dedicated communications
> server is provided (your transaction fees). Now if I have my own
> communications server, where do I host it? I need to have dual redundant
> Internet connections and if my community is large, I will need a load
> balance device and several servers clustered together. Where would I host
> this? It would be difficult and not cost effective to do this in-house, so
> I go to a hosting provider. What are the costs associated with hosting this
> with a hosting provider? How do I recover my costs for hosting this
> service? Do I charge my trading partners fees to connect to my newly
> established service to lower my costs?
>
> My argument here is that when an 800lb gorilla takes this in house to
> provide the service, the costs associated with provision of the service
> makes them become a VAN or they wear it. If they wear the costs, are those
> costs higher or lower than the VAN service (that has dedicated systems that
> are shared by several 800lb gorillas so each are only paying a "share" of
> the service provision).
>
> Feel free to continue the argument as I'm sure there will be many NULL
> supporters and few ALTERNATIVE supporters, but what we are aiming for is to
> disprove one of the Hypothesis statements.
>
> Best Regards,
>
> Michael Burbury
> GE ecXpress
> System Administration
>
> My views are not those of the company I work for and are purely my own views
> on this subject. Please do not think that because I work for a VAN, I might
> be biased towards the ALTERNATE Hypothesis. I take a passive stance that
> states that both Hypothesis are equal in costs and there are no savings
> associated with either method.
>
--
Michael C. Rawlins, Rawlins EC Consulting
www.rawlinsecconsulting.com
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