Buying electronic components from an online sourcing site has become a relatively simple affair: punch in a part number and information about what company is carrying the product, how many they have, and how much the devices cost is spit back almost instantaneously.
The process seems innocuous enough not to raise too many eyebrows.
But as high-tech companies' e-business strategies increase in sophistication and industry players try to carve a competitive Web edge, concerns about how information is collected and disseminated are starting to simmer. Like companies in other industries, those in the electronic-components marketplace are taking notice of a phenomenon known as Web crawling and are beginning to take steps to curb its use.
A Web crawler is a computer program that scours other Internet sites for information, such as pricing and availability, but which hits each site with such frequency-as much as 100 times a minute-that it can place a burden on companies whose host sites lack a muscular computing infrastructure.
While the IT issue of how to equip a site to handle such traffic is a headache for those developing e-platforms, the more pressing concerns for others in the supply chain are who has the right to access company information, how is that information used to generate revenue, and how can the integrity of data be protected once it is pulled and posted elsewhere.
Many of these subjects are still up for debate, and even the courts have not come up with hard and fast rules to follow. It's emerging law, according to attorneys and executives.
"Web crawling is one of the more cutting-edge legal issues out there, and the reason is that, like lots of things on the Internet, there are entire business models being developed that depend on that type of process being permissible," said Thomas R. Burke, an attorney at Davis, Wright Tremaine LLP in San Francisco.
The lack of legal precedent, however, has not stopped some companies from drawing a line in the sand, with the more obvious delineation coming between traditional brick-and-mortar distributors and emerging online exchanges. In fact, the stance each side has taken may reflect a bigger channel conflict, where newcomers and old-timers seek to define their place in the evolving sourcing and procurement market.
"There's such a distaste among franchised distributors to get involved with online exchanges," said Joe Gerato, director of business development at SupplyView Inc., Scarsdale, N.Y. "The bad taste in everyone's mouth is that it looks like the brokers are getting richer and the franchised players aren't."
"The issue seems to reside in the revenue models," said Mark Withington, research director at the Aberdeen Group Inc., Boston. "Channel conflict has always been a problem and will remain a problem."
When it comes to Web crawling, distributors like All American, Arrow, Avnet, Digi-Key, and Pioneer-Standard say competitiveness, data integrity, and accuracy are paramount, although in the same breath many admit they're still in the early stages of discerning who's coming to their sites, what data is being farmed, and where it goes after that.
"We have spent millions of dollars to develop our name and build our business. And now some companies are getting our information without our cooperation," said Steve Tsukichi, Digi-Key Corp.'s vice president of marketing.
"We're concerned about how the information is being used. Our philosophy is to keep our Web site as open as we can so our customers find it as easy to use as possible. We've thought about requiring registration as a result of this, but it's something we don't really want to do."
For many traditional distributors, Web crawling has the potential to dilute brand recognition and raises additional fears that appropriated information may be misrepresented, said Tom Hallam, president of Arrow Electronics Inc.'s Internet Business Group in Hauppauge, N.Y.
"If we allow someone else to convey information to the customer, it's possible that information could be wrong," Hallam said. "Just because another site shows that a part is unavailable doesn't mean we won't be able to satisfy a request. We may be able to satisfy a request out of our available inventory and be able to replenish our inventory."
Companies are taking measures to protect their online properties by issuing warnings to Web crawlers, blocking certain Internet addresses from accessing their URLs, and limiting pricing and inventory information to select partners.
"If they're not permitted to crawl our site, we ask them to stop. It rarely goes beyond that," Hallam said. "But if it doesn't look like it's working, we can block them from entering the Web site."
Avnet Inc. is working with its partners to create "a customer experience" on its Web site, said Lori Hartman, executive vice president of e-business at Avnet's Electronic Marketing Group. Where Web crawling is concerned, "it comes down to the business model-what community they are reaching and what are they going to do with the information," she said.
On the dot-com side, companies like PartMiner Inc. maintain that information pulled from Web sites is in the public domain and therefore can be posted in a way that facilitates a real-time buy-sell relationship, according to Earle Zucht, PartMiner's chief operating officer.
"We do about 200,000 part searches each week. When you hit a part number on our site, our Web crawlers go out and pull down information about the part in real time," Zucht said. "We're pulling information that is public information.
"The first thing companies have to do with their Web site is determine what information will be public and what information will be private," he said. "If companies decide to block me, they're really blocking the customer. It's not PartMiner that's coming out to ask for parts. It's someone at Lucent or HP."
Other online companies, such as Need2Buy Inc. and SupplyView, have taken a different approach to obtaining similar data: They rely on franchised and independent distributors and suppliers to upload information to their sites.
"Companies are sending us their inventory information on a daily basis. We don't get inventory information without their permission," SupplyView's Gerato said.
Need2Buy, Westlake Village, Calif., follows the same path, but is developing a service that will give distributors the option of allowing the online company to "data-mine" sites, said Andrew Wilson, president and chief operating officer.
"We want to collaborate with people in the supply chain and have made a conscious decision not to mine data," Wilson said, adding that distributors send information to Need2Buy in batch format a couple times a day.
"If they don't want to post information to an FTP [file-transfer protocol] and find it easier for us to gather the information, we could Web crawl their sites, but would only do it with their permission," he added.