Yahoo plans business-to-business directory

After building one of the most recognized Internet brand names as a consumer Web portal, Yahoo is gunning to become an online gateway for business.

The company today announced it has created a business-to-business (B2B) directory that offers listings of business e-commerce sites for industrial and commercial supplies such as drills and steel.

Although Yahoo brings a popular brand to the business-to-business sector, it will face strong competition from other e-business networks that cater solely to commercial players. Ariba and Commerce One, the makers of software that forms the foundation for many of today's business marketplaces, have already paved their way in the business commerce market. Web mall and services company ShopNow.com launched its B2Bnow.com site in January.

Although Yahoo offers services targeted at small businesses, such as links to office supply sellers and online postage services, this is the portal's first venture into business-to-business listings.

The company's move to set up its B2B Marketplace comes at a time when the nascent business-to-business sector is witnessing a nearly unprecedented explosion. Venture capital firms, consulting firms and established technology companies are rushing to take part in what is widely expected to become an Internet gold mine.

Just today, Internet services giant America Online said it is forming a partnership with PurchasePro.com to help set up marketplaces across several of its Web properties. eBay, Beyond.com and Priceline.com have all recently announced e-business strategies.

Online business transactions in the United States are expected to increase 33 percent each year, with $2.8 trillion changing hands through business-to-business purchases, according to management consulting firm Boston Consulting Group.

Yahoo said its business marketplace allows business users to research, price and purchase products they need for their industries. The marketplace will include listings by Freemarkets.com for raw materials and parts as well as services. DoveBid.com will also provide auction services at Yahoo's B2B exchange.