Web Services has reached a critical early milestone. XML Web service tools are shipping and, thanks to some clever introductory pricing strategies, at a price point that managers can afford. At the same time, developers are increasingly aware of SOAP, UDDI and WSDL and want to extend their skill sets to build Web service interfaces. This combination of accessible tools and developer enthusiasm will drive the adoption of Web services through 2003 and raise the level of discussion from what Web services is to what Web services can do.

Early rounds of discussion are focused on solving the internal integration problem – where technical hiccups don't become media events like Nike's high profile supply chain snafu last year. Inside the firewall, firms are still plagued by inefficient manual process, ineffective or nonexistent data coordination and an inability to automate even basic tasks. Web services can help solve some of the integration complexity, but it's no panacea. Integration is a multidimensional problem that demands various techniques and technologies. Web services can help developers build low-cost, system-to- system connections, but simply adding a SOAP wrapper and SOAP listener to existing applications will only send us back to the days of high maintenance, point-to-point integration. ISVs approaching the Web Services market from an integration standpoint must address the bigger issues of process and component integration, Web Services management issues like provisioning, and life-cycle management issues like testing and quality assurance.

The major challenge still resides at the application level – specifically with packaged applications. It's one thing to support Web services at the interface level, it's entirely different to drive revenue through Web services components. If business users still want integrated business functionality delivered over the Web, then Web services only means something to the IT personnel that must integrate several native Web applications or business functions. How will giant, horizontal applications fit into the service- oriented architectures that software infrastructure providers are helping their customers build? While it is obviously too soon to tell the final outcome, application vendors cannot avoid the oncoming train for long. Web services technologies will make outsourcing like customer relationship management a lot easier.

What we need with Web services is maturation of the technology and its supporting standards and maturation of usage beyond simple point-to-point application integration. Standards bodies are leading the charge on core standards like WS- I that should address the critical issues of interoperability and security.

Hurwitz Trend Watch Special Edition Weekly Commentary and Analysis on the Software and Services Industries – May 3, 2002

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