It’s already a given: Your company is going to waste money on Web services.

Research company Gartner predicts American business is going to squander $1 billion on misguided Web services projects by 2007. Exactly how much of that will come out of your pocket depends in part on how many confusing, overlapping Web services standards emerge in the next few years.

Right now, it looks like there’s going to be a lot of them.

The Web services standards process began to fall apart this year. No fewer than four organizations—Liberty Alliance, Oasis, W3C and WS-I—are vying to preside over the process, each with different goals, each with differing degrees of power and influence.

And two opposing camps of vendors have emerged: an uneasy alliance of IBM and Microsoft versus nearly everyone else. Both groups are busy duplicating each other’s work.

Both are proposing Web services specifications—some proprietary, some not—with unclear patent and licensing implications for CIOs. In an arena as complex as Web services, confusion is not a good thing. But right now, that’s the situation.

The Web services vision is grand: a universal set of communications protocols to enable computer systems and business processes to seek each other out over the Internet, lonely hearts style, and have deep, meaningful interactions with no human intervention. Even in today’s rudimentary state, Web services standards such as simple object access protocol, or SOAP (see "Core Web Services Standards," Page 58, for the list of current standards), are proving to be valuable integration technologies. A Gartner survey of 110 companies found that 54 percent are already working on Web services projects or have plans to begin soon, and IDC (a sister company to CIO’s publisher) estimates that companies will do $2.2 billion worth of Web services projects in 2003 and $25 billion in 2008.

"The potential revenue impact of these standards is enormous," says Whit Andrews, research director for Gartner. But the very size of that financial prize waiting for the winners of the Web services standards competition makes it "difficult to remain involved in a standards effort that involves your competitor," he adds. Gartner goes so far as to predict that the alliance between IBM and Microsoft will break down by the end of this year, given that the companies are direct competitors in the application server and database markets that make the biggest use of Web services.

"That’s silly," responds IBM spokesman Steven Eisenstadt. Steven VanRoekel, Microsoft’s director of platform strategy, says, "I couldn’t speculate on how long things will go [between Microsoft and IBM]."