What is EDIINT? What is AS2, and how does it differ from AS3 or AS4? November 2, 2010

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What is EDIINT? What is AS2, and how does it differ from AS3 or AS4?

EDI, or Electronic Data Interchange, is a format used by large enterprises for exchanging digital information about purchase orders, invoices, and other business supply chain related information with other companies, businesses, and enterprises.

EDIINT stands for EDI over INTernet.

One of the concerns and needs of the large business enterprises using EDI for electronic transactions throughout the 1990’s was the burgeoning requirement from these enterprises to be able to exchange EDI formatted data streams over the public Internet, securely. Towards the late 1990’s, EDIINT using a secure digital transmission conduit over the public Internet, called AS1, technology was standardized and released by the web standards bodies.

The AS1 protocol leveraged SMTP (standard Simple Mail Transport Protocol, or Internet email) as the foundation for exchanging communications. During this early phase of EDIINT deployments and AS1 protocol adoption, several software vendors emerged, offering to eliminate the de rigeur (for the time) VAN (Value-Added Network) fees that were commonly levied against large enterprises by the VANs then in existence. The development of the AS1 protocol, which allowed transfer of EDI messages and transactions securely over the public Internet, should have enabled these large enterprises to use AS1 to connect point-to-point with each other securely over the public Internet without need of VANs or their fee structures.

But although the ideal of AS1 was certainly promising, the promised elimination of VAN network access fees never really materialized, and the AS1 protocol unfortunately did not encounter widespread adoption and acceptance by the larger enterprises’ IT organizations. Several common reasons were behind this shunning of AS1 by corporate IT departments. One reason was the fear of larger enterprises that moving away from the liability endemnification of the VAN networks to transmissions over the (albeit secured) public Internet using AS1 was not quite ready for wholesale adoption by large scale enterprises in mission critical transaction environments. Another reason was some corporate IT departments were fearful, with considerable justification, of overloading enterprise email servers with EDI traffic as a result of the AS1 protocol’s dependence upon secured SMTP packets, which would route through corporate Microsoft Exchange or other SMTP email servers. In addition, SMTP email did not encorporate enough feature robustness to ensure the real time delivery of SMTP email and, more critically, enforce the non-repudiation features of the EDI standards then in common use.

The next incarnation of EDIINT emerged in 2001 with the new AS2 protocol superceding the earlier AS1. AS2 was designed from the start to address the same needs and requirements of the earlier AS1 protocol, but with the major distinction that AS2 was based upon the HTTP protocol instead of AS1’s reliance on the SMTP protocol. AS2’s use of HTTP instead of SMTP provided a more direct and realtime connection for transmitting EDI data between companies. The use of HTTP, combined with the growing acceptance of the Internet as a serious venue for international commerce, led to AS2 gaining a much stronger foundation upon deployment and saw AS2 gain a significant foothold into corporate IT departments in terms of adoption and implementation that AS1 had never enjoyed. But although interest in AS2 was greater than it had been for AS1, AS2 still did not reach mainstream wholesale adoption from large corporate enterprises.

Walmart and the adoption of AS2

The lack of enthusiasm at the corporate level for AS1 and AS2 adoption largely came about because of the lack of a “Market Maker”, or a powerful intermediary enforcing adoption and deployment of AS2 for EDIINT. Two companies were required to decide together to use a protocol such as AS1 or AS2, as either protocol necessitates coordination on both ends. This meant that although an enterprise might make the decision to work with a significant partner or primary systems integrator to deploy AS2, for most of that enterprises’s supplier, customer and vendor business relationships, the payoff would hardly be worth the effort.

All of this changed overnight in 2002 when Walmart announced that their entire EDI transactions and transmissions program would be moving over to the AS2 protocol and that *all* of their suppliers were expected – required absolutely, in typical Walmart fashion – to follow suit. Walmart’s decision was the tipping point for AS2’s widespread adoption and deployment across many industries and enterprises of various scale. Walmart’s reputation as a supply chain industry thought leader, as well as their renowned strong-arm tactics with their suppliers and vendors, forced other large enterprises to follow their lead. Walmart’s dictat led to positive feedback loops and various other network effects as a large number of Walmart suppliers fully AS2 enabled led to a growing ecosystem of AS2 -enabled vendors and supplies in the marketplace. Thus it became even easier for recalcitrant suppliers to justify jumping into the EDIINT, AS2 pool. AS2 enabled suppliers were able to easily extend their transactional AS2-based EDIINT systems into a vibrant community of AS2 enabled enterprises. As a result, by 2003 AS2 became one of the most popular data protocols for EDI transmissions within North America.

Europe and the Odette File Transfer Protocol V2, or OFTP V2

Despite the rapid spread of AS2 in the United States, Canada and Mexico, however, AS2 adoption lagged in Europe. The major reason for the discrepancy of AS2 adoption rates between North America and Europe was the lack of a European market maker ala Walmart in the United States. Without a key champion like Walmart driving the rapid adoption of AS2 in Europe, AS2 usage has taken a much longer time to spread into Europe’s major enterprises.

Into this vacuum, a new standard has emerged in Europe which may supplant the adoption of AS2 entirely if enough enterprises of scale in Europe decide to adopt it. The standard’s name is Version 2 of the Odette File Transfer Protocol, or OFTP V2, and it is a very similar protocol to AS2 in the fact that it leverages both the public Internet and HTTP for connectivity. In Europe, large automotive enterprises such as Volkswagen, Volva and PSA are driving the adoption of OFTP V2 in an industry-wide effort to reduce costly VAN networking fees. This wave of automotive suppliers supporting OFTP V2 should follow a similar pattern, although perhaps on not quite as large a scale, to the adoption of AS2 in North America by retail suppliers and vendors in response to Walmart’s urgings and data integration requirements.

Future EDIINT Standards: AS3 and AS4 and SOA

Future standards likely to emerge within the next iterations of EDIINT are likely to include AS3, which is based upon FTP, and AS4, which is based upon web services. Each of these newer variants contains benefits not available to users of AS2, for instance, AS3 does not require an ‘always on’ connection and could potentially handle large files better than AS2. AS4 can integrate with SOA (Services Oriented Architecture) software infrastructures with relative ease, something that is prohibitively difficult at present with AS2. Despite these technological advances, if a large enterprise or company is trying to determine which protocol is more apropos to use for EDI transmissions, they are likely to choose AS2 despite its limitations simply because the large community of companies already using AS2 versus trying to forge an uncertain path trailblazing the use of AS3 or AS4 in the absence of a market maker as mentioned above.

So until another market maker emerges to drive the adoption of AS3 or AS4 as Walmart did with AS2, AS2 will continue to be the de facto standard for EDI transmissions over the Internet. Instead of companies and large enterprises across different industries moving to AS3 or AS4, AS2 is instead adopting features that address the benefits available in those other standards. For example, an effort is under way to add “Restart” capability to AS2 that was announced recently, and this would provide some of the better support for larger file transfers that we have seen in AS3.

You’re reading Boston’s Hub Tech Insider, a blog stuffed with years of articles about Boston technology startups and venture capital-backed companies,software development, Agile project management, managing software teams, designing web-based business applications, running successful software development projects, ecommerce and telecommunications.

About the author.

I’m Paul Seibert, Editor of Boston’s Hub Tech Insider, a Boston focused technology blog. You can connect with me on LinkedIn, follow me on Twitter, even friend me on Facebook if you’re cool. I own and am trying to sell a dual-zoned, residential & commercial Office Building in Natick, MA. I have a background in entrepreneurship, ecommerce, telecommunications andsoftware development, I’m the Director, Technical Projects at eSpendWise, I’m a serial entrepreneur and the co-founder of Tshirtnow.net.

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