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The remains of one of the biggest dotcom-era busts, Covisint LLC, have been dismembered, the end coming at the hands of Compuware Inc. for a, "small cash transaction."
Conceived in early 2000 -- just before the dotcom crash began -- and launched in October 2000, Covisint was a surprising joint venture of Detroit's Big Three automakers (GM, Ford, DaimlerChrysler).
Covisint was broadly described as the way the Big Three would streamline purchasing and cut costs by setting up Internet-based e-commerce purchasing exchanges and reverse auctions. Backed by a media blitz and storm of press releases, the partners heralded Covisint as the "next big thing" in e-commerce, leveraging their massive purchasing power to achieve "economies of speed" and lower acquisition costs.
The prospect of automakers pooling as much as $500 billion in joint purchasing power had the dotcom community buzzing but left parts suppliers suspicious. Suppliers saw Covisint as just another way to squeeze them while automakers reaped the rewards in higher profits.
A few derided it from the beginning as a management-by-committee effort by the Big Three to cash in on the dotcom boom, a boom which had also hurt traditional manufacturers by hobbling their access to funding, talent, and media attention. The automakers were obliged to deny Covisint was a "press release machine" or "get rich quick" scheme, chasing dotcom riches from an Initial Public Offering (IPO) of Covisint stock -- estimated then by many analysts to be worth as much as $5 billion.
But funded by thirds, staffed equally by GM, Ford and DaimlerChrysler employees, and with a matching trio of "co-Presidents," Covisint suffered competitive paralysis from the beginning. The three would not easily set aside 80 years of hard-fought competition. It quickly became clear there was no consensus how the business would proceed, be put to use, or even what software standards would apply.
The timing turned out to be equally bad. In the eight long months that passed between press releases and actually launching Covisint, the dotcom crash had begun and was well underway. One analyst said, "IPO greed and the sheer momentum of three huge companies made it impossible to stop Covisint when they should have."
Of the other auto manufacturers, only Renault and Nissan eventually signed on, and suppliers stayed away in droves. The cost, complexity, lack of standards or even basic supply chain management were problems not helped by unanswered concerns about the security of data, designs, pricing, and other competitive information.
A virtual revolving door for Covisint executives also hindered the business. With few exceptions, the partners were criticized for hiring by committee, inserting politically viable but unqualified leadership. Others claimed the business essentially failed before it started, so who was in charge would never matter. In its short life, well over a half dozen people have held the title of co-President or CEO -- despite the position being vacant at one point for over a year.
In three years, Covisint spent between $350 million and $500 million pursuing a variety of unsuccessful business models and repeatedly "re-purposing" the operation. Eventually, the company developed a workable auction component and custom-designed Internet communication applications.
Covisint recently claimed to have more than 135,000 users in almost 100 countries using its products. But an auto industry executive told eBearing those are simply captive users of its messaging system.
In late December 2003, Covisint sold off its auction component to FreeMarkets, a money losing e-commerce venture which hosts auctions and provides software. FreeMarkets is now being acquired by Ariba, a money losing ($639 million in 2002 and $106 million in 2003) company providing "Enterprise Spend Management" solutions.
Now Compuware Corp. has, "entered into a definitive agreement," to acquire Covisint's remaining messaging, portal and web services assets for a "small cash transaction."
Compuware is a Detroit-based software and services provider with strong links to the auto industry.
Compuware said the majority of Covisint's employees will be retained and will move to their headquarters over the next few months. The company said no decision has been made whether it will continue to support the Covisint name.
| Product Model | Inside Diameter | Outside Diameter | Thickness |
| BAM1510 IKO | 23.812 | 30.162 | 15.88 |
| CR26VB IKO | 41.275 | 23.6 |