Through a phased approach, MetalExchange ultimately will encompass other metals, such as copper, aluminum and zinc. It's important to note that we're not changing the basic buying and selling processes, we're just making them easier and more convenient. Sellers will provide MetalExchange with daily product and pricing information independently of each other. In effect, MetalExchange is serving as an independent clearinghouse for metals industry information, product availability and online purchases. The individual sellers, and not MetalExchange, are responsible for pricing, order fulfillment and payment processing through traditional channels.
Buyers can access and use the site for free.
Sellers will be assessed a transaction fee for each online sale as well as an annual service fee for consulting and development of an individual market center, which basically is a mini-Web site for each seller within the MetalExchange site. The research shows that about 80 percent of people in the steel industry have access to the Internet from work, and the number is expected to reach nearly 100 percent by 2000. MetalExchange first will launch the content and collaboration components this fall, followed closely by commerce. The commerce function will feature a multi-company catalog that buyers can access and use to make online purchases. Participating metals producers also can use MetalExchange's online auction service to solicit bids for a particular product, privately review the bids and then award the sale.