He expects to announce a second regional hub with a Midwest utility this week, and says he is close to signing a utility in the South. One of the keys to success for the regional hubs, according to Mitnick, will be to make it possible for small and midsize businesses to buy services online, since small companies usually hire local accountants and ad agencies. Some national sites have begun to beef up their service offerings. But there's no guarantee that a small company will find, say, a security firm in its area on the site. Mitnick came up with the idea for regional hubs last fall, when he was working in the utility practice of Hagler Bailly, an Arlington, Va., consulting company.
Banks are one possibility.
Telephone companies are another. But we think utilities have an edge because they have more buying power within a region. The utilities also have deep pockets, and they're under pressure to become more efficient and find new revenue streams in the face of increasing competition as their industry is deregulated. We also saw a business opportunity. But, he says, Potomac Electric prefers the idea of a regional procurement hub because it could stimulate regional business activity, which in turn would create more demand for electricity.