And so it is with web services. Two years ago Microsoft began preaching about XML web services as the next major platform for application development. IBM, BEA Systems and a host of other tools vendors rushed in as well, all declaring that the era of the internet as an application development platform was finally at hand.
But the truth has been obvious for anyone who does more than a cursory investigation. Although web services will eventually turn the internet into an application development platform by leveraging XML, SOAP, UDDI and other technology standards still in development, the initial promise of web services -- vendor hype aside -- was to lower the cost of application integration.
So in the context of its short term impact on the enterprise, web services technologies have been wildly successful. Merrill Lynch, DuPont, General Motors, Wachovia, Nasdaq, Continental Airlines, Dollar Rent a Car, JP Morgan Chase and Zagat saved substantial dollars on application integration projects thanks to web services. Merrill Lynch was able to accomplish an application integration project originally priced at $US800,000 for $US30,000. Multiply savings like that over several projects and multiple companies, and it's clear that web services can save businesses millions of dollars.
Companies such as Google, AAA, Amazon and eBay are now beginning to unveil web services that reach out to their customers and business partners, which means web services are now having an impact on business-to-business e-commerce . Even more interesting is the second generation of the application service provider model powered by web services, with successful startup companies such as Wand, Xign, Checkfree, Salesforce.com, Elogex and Outtask all using web services to beat the integration issues that scuttled so many first-generation ASPs.
All things considered, web services are way ahead of where any reasonable soul would have expected. And we have only explored the tip of the iceberg. Web services will have a profound effect on how the next generation of enterprise applications is built, deployed and maintained.
What we have seen up to now is only the end of the beginning.