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When it comes to e-commerce, you’re take-charge folks, and banking your companies’ futures on it — even if it means plunking down hundreds of thousands of dollars.
Nearly 25% of respondents to our e-commerce survey expect to spend no less than $1 million on e-commerce initiatives. Another 28% will spend between $100,000 and $500,000. Clearly e-commerce is becoming a bet-your-business strategy, as we’ve discovered from 100 Network World readers who participated in the survey, conducted by Enterprise Management Associates, in Boulder, Colo.
But the burgeoning Web hosting community clamoring to get your e-commerce dollars shouldn’t get too excited. It seems many network managers plan on keeping e-commerce to themselves. Nearly 75% of respondents said they develop their own e-commerce applications using home-grown tools. Another 40% use off-the-shelf application development tools. And what’s developed in-house stays there. The majority of respondents — 79% — host e-commerce applications in-house. Those who rely on a Web hosting service prefer using servers provided by the outsourcing firm rather than deploying their own equipment at the external site. Either way, e-commerce managers who have opted to host Web applications externally said they’ve done so because they can make their applications more secure, get better performance and spend less money than if they implemented them in-house. How much are these firms spending on hosting? Less than $5,000 per month gets nearly 67% of respondents a hosted e-commerce application. Now, but not forever  While our survey shows that readers favor in-house e-commerce development and support these days, that may not be the case in the future. That’s how Chris Calabrese, a network security analyst for a managed health care firm, sees it. He says his company built its business and consumer e-commerce applications, but is now looking at outsourcing.
Likewise, some folks who have outsourced don’t plan to do so forever. The Orange County Transportation Authority, for instance, is looking to move some e-commerce operations in-house. Through its e-commerce site, this California agency posts requests for proposal and accepts bids. An outside firm, ThirdWave, developed the application using Microsoft Active Server Pages running on Microsoft’s Internet Information Server.
“ThirdWave is under contract for a year to provide support. In that time, our staff will get to know how it was written and get familiar with it so we can carry on after the warranty expires,” says Joe Tiernan, IS planning analyst with the agency.
 Ditto for City County Credit Union in St. Paul, Minn. “We have a dedicated connection to [outsourcer Virtual Financial]. We wanted to get our feet wet without the support headaches,” says Marc Kilgore, vice president of IS for the credit union. “I certainly see the day when we will bring it in-house.”
Eyeing e-comm performanceIn-house or outsourced, e-commerce applications are closely watched. E-commerce managers who outsource demand accountability from Web hosts. Nearly 80% of respondents who are outsourcing have signed service-level agreements, and 75% said they are able to monitor the performance and availability of their e-commerce applications at the Web host. More than three-quarters of those respondents receive daily, weekly or monthly historic reports, while 17% receive real-time statistics. Managers who keep e-commerce operations in-house said server and application availability are at the top of their lists. Key metrics are usage of database, memory and other resources; transaction processing time and rate; service failure; and user response time. On the latter, 40% of respondents considered user response time a primary indicator of how successful their sites will be.
By the numbers Links to information about electronic commerce from Network World Fusion. E-commerce resources - Case studies Learn what makes the Web's biggest commerce sites click. Global e-commerce needs more time, study finds Network World, 02/24/00
CEOs: E-commerce altering the competitive landscape
Revving the e-commerce engine
Musthaler: In e-comm, customer service should be fundamental
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Windows NT: The big fish
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