The NSW Government has given strong indications that it expects technology behind its new online procurement system, announced today, to provide standards for commercial e-commerce operators.

"I wouldn't wish to say that we will come out and tell the industry what to do, what I will say is that this is where government is going," said David Lewis, group general manager of e-business solutions at the NSW Department of Public Works and Services (DPWS).

The system, to be launched in 90 days and touted as the largest in Australia, is the central plank of the Government's procurement reform package and is the result of new standards that have been developed by Australian government agencies in recent years, said Lewis.

"One of the things I don't want to have happen is the digital version of the railway guages," said Lewis, explaining the direction of recent e-marketplace discussions between State and Federal governments and the Australian Procurement Construction Council.

The indications coming from the government have been supported by an executive at global system integrator Logica, which won the AU$25 million dollar tender contract to build and manage the system last week.

Logica executive director, Geoff Cosgriff, said the technology would give suppliers the ability to build online catalogues "not just to trade with government but to trade with other agencies".

The NSW government is launching its service amidst great uncertainty in the e-commerce industry following a raft of e-market failures, both locally and in the United States.

Lewis acknowledged that the Government's system would be under heavy scrutiny but said the government was simply "dot-com-ing what [it's] been doing for some time".

According to Lewis, many commercial players have failed in the online procurement stakes because develop their strategies before completely understanding the vagaries of the market.

"You need to have a range of buyers -- which we already have; you need to have a range of suppliers --which we already have," he said.

Logica has enlisted German-based IT company Intershop to design the NSW Government marketplace.

Intershop has already had some success running government procurement systems, contracting to the NSW DPWS's German equivalent, the Ministry of the Interior.

The system is being rolled with expectations that it will carry an estimated 11 million transactions worth $AU4 billion dollars within three years.

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