1. Field of the Invention
The present invention relates to the auctioning of services, particularly to the auctioning of document services, and more particularly to the auctioning of document services over an information exchange network.
2. Description of Related Art
In a market driven economy, one of the expectations that customers have is to obtain the best pricing. Traditionally, suppliers of goods and services establish pricing based on whatever the market would bear, based on the economics of supply and demand. Competition among suppliers tends to drive pricing down to some extent. Competition may be effectively created “on demand” by means of an auction process, for the supply side, the demand side or both. For the supply side, customers can typically obtain the lowest prices from auctioning to the suppliers the goods and services demanded by the customers. Some economists believe that the true market price is established via auctioning.
Traditional auctioning processes are quite effective for transacting goods, for which quality can be determined relatively easily, as compared to services. However, auctioning of services might not be effective to ensure best pricing because of the nature of services. While the lowest price might be obtained from auctioning a service, it might not be the best pricing considering the potential range of quality in the delivery of the services.
Take for example document services, and more specifically printing services. Print jobs are not commodities like office supplies, toys or Treasury bonds. Each print job is unique and each printer is unique. Needless to mention, buyers want the best price taking into consideration of the quality of the job and services of the printers. Traditionally, to obtain the best price on a print job, a buyer needs to shop around for several printers, requiring one-on-one dealing with each prospective printer. Such shopping around for the best price is time-consuming. The buyer's choice of printers is limited to printers that are located within certain geographical boundaries that can be reasonably explored by the buyer within time constraints. The result is an economically inefficient market, in which resource allocation and pricing are sub-optimal.
U.S. Pat. No. 5,826,244 to Huberman (fully incorporated by reference herein) describes a process that relies on the Internet to broker document services. According to the Huberman process, a buyer who needs a particular document services job done can provide a request for these services to an online broker. Service providers can bid competitively on the request by submitting bids to the broker, who awards the job to the lowest bidder. Alternatively, instead of simply picking a winner, the Huberman process offers the buyers a choice of several possible winners, based on, for example, a number of winning bids. The customer can then be given an opportunity to select from among these candidates, or to decline or cancel. It appears that the customers do not preset at the start of the auction the number of winning bids that would be offered to the customers. While the Huberman process improves the efficiency of document services transaction and pricing practices related thereto, its auctioning process has several drawbacks.
While buyers want to encourage printers to compete on price, buyers generally cannot agree to accept the lowest bid. A buyer needs to select the best printer for a requested job based on factors such as the printer's reputation or geographic proximity to the buyer. Not every job and every buyer involves the same tradeoff between price and quality. In some cases, only price matters, but in other cases, jobs may be relatively insensitive to price. By showing the buyers several bids in accordance with the Huberman process, without some control as to the number of bids, the printers realize that they can bid a higher price and may still be able to win the job. Consequently, the Huberman process does not encourage the printers to give their best price while preserving the buyers' ability to select a printer on factors other than price.
Further, buyers do not want to be committed to execute a job at all, while printers want to spend their time bidding on real jobs that actually will happen. The Huberman process allows the buyers to rely on their sole discretion to decline or cancel a print job, but it does not provide sufficient protection for the printers to avoid wasting resources to create an estimate for the print job to bid at the auction which would be eventually declined or cancelled by the buyers. Without some level of comfort for the printers to feel that they are not wasting their time participating in the auction process, some printers may quickly lose interest in the auctioning process. Without sufficient printer participation, auctioning may be less effective in establishing lowest pricing to the buyers. Huberman clearly realized that forcing buyers to execute on a job request would not work, as buyers often need to know the cost before they can decide whether or not to execute. Charging a fee to buyers for posting job requests would eliminate the non-serious buyers, but would also discourage serious buyers from auctioning their jobs. Disclosing the buyer's identity to the printers would allow the printers to avoid the buyers known to “habitually” decline or cancel on the print job, but would also encourage the printers to selectively bid on only the jobs of well-known buyers, thereby negating the intended effect of auctioning. Also, buyers worry that their competitors could guess their business plans if their identities were disclosed. For example, if a buyer auctions a job online to print newspaper inserts, its competitor might guess that it plans a new promotion if its identity were published.
Accordingly, it is desirable to provide an improved auctioning process that will encourage the service providers to give their best prices while preserving the buyers' ability to select a provider based on factors other than price. Further, it is desirable to provide an improved auctioning process that will encourage the service providers to allocate resources to participate in the auctioning process while protecting buyers' confidentiality.