Van Value Added Network

[Dunstan Jomphe]

Avalue-added network (VAN) is a hosted service offering that acts as an intermediary between business partners sharing standards based on proprietary data via shared business processes. The offered service is referred to as "value-added network services".

Following in the wake of timesharing providers, provision of leased lines between terminals and data centers proved a sustainable business which led to the establishment of dedicated business units and companies specialized in the management and marketing of such network services. See Tymshare for an example of a timeshare services company that spun off Tymnet as a data communications specialist with a complex product portfolio.

The large-scale allocation of network services by private companies was in conflict with state-controlled telecommunications sector. To be able to gain a license for telecommunication service provision to customers, a private business had to "add value" to the communications line in order to be a distinguishable service. Therefore, the notion of "value-added network services" was established to allow for operation of such private businesses as an exemption from state control.

The telecommunication operator sector was marketed in the USA in 1982 (see Modification of Final Judgment) and in the United Kingdom starting with the early 1980s (mainly due to the privatization of British Telecom under Prime Minister Margaret Thatcher). In the later 1980s, running a value-added network service required licensing in the U.K. while the term "value-added network" had merely become a functional description of a specific subset of networked data communication in the USA.[1]

On a multinational scale, and due to the heterogeneous telecommunication economy and infrastructure before the market penetration of the Internet, management of a value-added network service proved a complicated task leading to the idea of user-defined networks,[2] a concept preceding the nowadays ubiquitous availability of internet service. Standardization efforts for data networking were made by ITU-T (formerly CCIT) and included X.25 packet-switched networks and X.400 message handling systems, specifically motivated by an emerging transatlantic competition[3] in the early 1990s.

In the absence of state-operated telecommunication sector, value-added network services are still used, mainly as a functional description, in conjunction with dedicated leased lines for business-to-business communications (especially for EDIFACT data transfer).

Traditionally, most value-added network services mainly supported general-purpose business-to-business integration capabilities focused on electronic data interchanges, but service providers are evolving to become more process- and industry-specific over time, particularly in industries such as retail and hi-tech manufacturing.[citation needed] Some sources suggest that modern value-added network services should be called "trading grids" due to commonalities with grid computing.[6]Others distinguish internet service providers from international value-added network services (IVANS) operators.[7]

The vast majority of EDI still occurs via EDI VAN also known as Value Added Network. Despite the emergence of some basic, low-cost approaches, such as Web EDI or EDI via AS2, the EDI VAN model continues to be the preferred option due to the value- added service that EDI VAN providers can deliver. Often companies look to implement a hybrid strategy in which different types of EDI are implemented as appropriate to the business, but the EDI VAN remains the core to these installations.

To simplify the complexity of managing multiple EDI direct connections, a company can use a single connection to an EDI VAN, which provides partner connections. The EDI VAN is simply a secure network where EDI documents can be exchanged between a network of business partners. An organization will be provided with a mailbox by the EDI VAN provider. Documents are sent and received from there and the organization checks the mailbox periodically to retrieve its documents. Most EDI VAN providers offer an alerting service that informs the sender when messages have been sent successfully and also notifies the recipient that a new message is waiting.

In addition to the many EDI benefits your company can realize by moving away from manual paper-based document exchange, companies who enlist the services of an EDI VAN provider can take advantage of additional value added services, such as:

Each time new document exchange standards appear, discussions suggest this may be the end of EDI. However, after over 50 years, EDI is still going strong due to its flexibility to absorb new technologies into its networks. XML and APIs all have their place, but EDI volume continues to grow as well. It turns out that new protocols and standards just add to the complexity requiring more sophisticated EDI VAN services that can truly handle any-to-any connections.

A value-added network (VAN) is used by businesses to exchange information among each other. The main goal of a VAN is to facilitate electronic data interchange (EDI) between businesses. The VAN sits on top of an existing common carrier. The carrier provides additional services on top of the infrastructure called value-added services. Hence, the name value-added network.

Multiple businesses connected to one another. This is the most common type of network used in the financial markets since there are many market participants connected to each other via a single venue.

VANs transfer data using standard formats, such as XML and CSV. They allow the data to be read by the various Enterprise Resource Planning (ERP) software used by companies. They also enable the use of newer technologies without making changes to existing technology.

As stated before, VANs are standalone networks, which means a company would need to hire specialized individuals to build the network, as well as pay for the infrastructure. On the other hand, internet-based systems come with most of the infrastructure already in place and need only the software work to be done.

Technical and specialized staff is required to keep the network running. Moreover, upgrading is also difficult due to the unique nature of the networks. In comparison, internet-based technologies are much easier to maintain without requiring a very high degree of technical sophistication.

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A Value Added Network (VAN) is a private network that provides additional services on top of basic data transmission for secure electronic data interchange (EDI) between trading partners. VANs act as intermediaries, facilitating the exchange of EDI transactions between businesses by providing services such as data validation, formatting, encryption, and communication protocols to ensure the secure and reliable transmission of data.

VANs also offer value-added services, such as data mapping, data transformation, and other customization options, to meet specific business requirements. VANs serve as a secure and efficient means for businesses to exchange electronic business documents, such as purchase orders, invoices, and shipping notices, with their trading partners, enabling seamless integration of supply chains and enhancing business processes.

When companies and their trading partners need to communicate, they typically connect to the same value-added network (VAN), which is often outsourced to an EDI VAN provider. Once all parties are connected to the VAN, any EDI documents they send to each other will pass through the VAN before reaching their intended recipients. The VAN may also handle any necessary translation of the EDI documents to ensure they arrive in the correct format.

The one-to-one network is a direct point-to-point connection between two businesses to exchange EDI data. In this type of network, there is a direct connection between two nodes, and value is added to the information that is transmitted between them.

A peer-to-peer network is where two devices are connected directly to each other for the purpose of sharing files or resources. In this case, value is added by enabling the devices to communicate with each other without the need for a central server or intermediary.

A single supplier connected to multiple trading partners using a third-party VAN. No matter which communication protocol is used at the trading partner end, VAN can easily connect and transmit the EDI data.

In this type of setup, multiple businesses are connected to one another. This is the most common type of VAN network connection majorly used in the healthcare, finance, and logistics industries as there are many segments connected to each other via a single destination node.

Value Added Networks (VANs) are secure and reliable platforms that facilitate electronic data interchange (EDI) between business partners. There are several types of VANs available, including public VANs, private VANs, cloud-based VANs, industry-specific VANs, and hybrid VANs. Each type offers unique features and benefits tailored to different business needs.

A Public Value Added Network is a VAN that serves a wide range of businesses across various industries. It offers a shared platform for EDI communication, making it cost-effective for small to medium-sized businesses with moderate transaction volumes. Public VANs are suitable when businesses require broad connectivity, standard document exchange, and affordability.

A Private Value Added Network is a dedicated network established for a specific organization or group of partners. Unlike public VANs, private VANs offer enhanced security, customization, and control over data exchange processes. This type of VAN is suitable for larger enterprises or organizations that demand heightened security and require tailored integration with internal systems.

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