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Market Design Inc. and TradingDynamics Team to Deliver B2B Trading Solutions

World Experts in Market Design and Auction Theory to Help TradingDynamics’ Customers Design Optimal Business-to-Business Internet Auctions and Exchanges

MOUNTAIN VIEW, CA – October 18, 1999 – TradingDynamics, Inc., a leading provider of business-to-business Internet trading solutions, and Market Design Inc. (MDI) today announced that they have teamed to deliver market design and training services to help customers create optimal business-to-business (B2B) Internet auctions and exchanges. MDI is the world’s leading consulting firm specializing in the design of electronic markets and has extensive experience designing auctions and exchanges for telecommunications, electricity, minerals, and other industries. The comprehensive and highly configurable TradingDynamicsÔ Market Suite lets firms deploy and configure Internet auctions, reverse auctions, and exchanges as quickly as business conditions demand. Together MDI and TradingDynamics will help companies to quickly implement online auctions and exchanges that are tailored for their business needs – based on market design best practices and driven by the industry’s most advanced B2B Internet trading applications.

Under the agreement, MDI, whose principals are recognized authorities on auction theory and practice, will work closely with TradingDynamics’ customers to assess their business needs and goals. Then, leveraging the extensive configurability of the TradingDynamics Market Suite, MDI will help them to design markets that meet those specific requirements. This focus on driving market design from business goals is critical, since B2B Internet trading must balance a whole range of business issues, such as revenue objectives, preferred customers, and tiered supplier relationships. Working with TradingDynamics and MDI, companies can tailor their trading systems to, for example, create special conditions for preferred customers and partners, or introduce tiered competition into the procurement process. As a result, companies can create effective auctions, reverse auctions and exchanges that complement their existing operations and business relationships.

MDI and TradingDynamics also will jointly develop an education program to help organizations design and fine-tune their own auctions and exchanges to support business objectives. MDI consulting is available immediately. The education program will be rolled out in Q1 2000.

"At MDI, we have found that the TradingDynamics Market Suite is the only business-to-business Internet trading solution that offers the required functionality and flexibility to support our innovative market designs," said Peter Cramton, president of MDI. "Through our relationship with TradingDynamics, we are able to offer companies a complete solution for B2B Internet trading, from state-of-the-art market design through software implementation. The TradingDynamics technology, coupled with the expertise at Market Design, gives companies an unparalleled ability to realize their trading goals."

“Our customers have a great deal riding on the success of their B2B Internet auctions and exchanges. Even the slightest changes in market design can have a tremendous impact on the outcome,” said Kirk Cruikshank, president and CEO for TradingDynamics. “We focus on delivering highly configurable applications for fine-grained customization of a company’s auctions and exchanges. MDI’s world-class consultants help our customers realize the full potential of our applications by offering state-of-the-art market design consulting to create the right auctions and exchanges for each of their business situations.” (For more on the TradingDynamics Market Suite, see the October 18, 1999 press release announcing the product.)

Market Design Inc.

Founded in 1995, Market Design Inc. offers consulting services in the design of auction markets. The principals are academic experts in auction theory and practice. The company has advised governments and firms worldwide on the design of electronic markets for telecommunications, electricity, mineral rights, and other assets. Customers of Market Design’s consulting services have included the Federal Communications Commission (FCC), MCI, Lockheed-Martin, the California Trust (Western Power Exchange), California Independent System Operator (Cal ISO), ISO New England, and PacTel, as well as the governments of Australia, Austria, Canada, Mexico, the United Kingdom, and New Zealand. MDI has offices in Washington, DC, Palo Alto, Calif., and Austin, Texas. For more information see www.market-design.com.

About TradingDynamics

TradingDynamics is a leading provider of business-to-business Internet trading applications. Combining expertise in economics, market design and Internet application development, the company lets net market makers and corporations quickly deploy and configure a range of dynamically-priced markets – including auctions, reverse auctions and exchanges. TradingDynamics is a privately held company based in Mountain View, Calif., and can be reached by phone at (650) 567-5900 or via the Internet at www.tradingdynamics.com.

TradingDynamics is a trademark of TradingDynamics, Inc. All other names may be trademarks of the companies with which they are associated.

Contacts:

Drew Harman                                   Peter Cramton                         Erica Lee
TradingDynamics                              Market Design Inc.                   Blanc & Otus
650.567.5903                                     301.405.6987                            415.912.2300
drewh@tradingdynamics.com            info@market-design.com        elee@blancandotus.com