From the editor.

A couple of years ago, e-commerce was all the rage. With the bursting of the dot-com bubble and the onset of the recession, that changed. But the underlying promise of e-commerce -- of using technology to enhance relationships with customers and suppliers -- certainly hasn't changed.

In our cover story, we look at several different aspects of the e-commerce evolution. Consultant Peter Cohan offers a thoughtful overview of what's working effectively in corporate e-commerce and what executives should focus on to make those efforts profitable. Managing Editor Ellen Heffes spoke to KPMG's partner in charge of its media and entertainment practice, as well as the CFOs at The Walt Disney Co. and Comcast Corp. to find out how they view the confluence of e-commerce and content distribution playing out in the next few years. In a third segment, a Bank of Montreal executive offers concrete advice about improving electronic procurement.

The rise of electronic communications networks (ECNs) has brought new competition and uncertainty to the securities markets. Writer Gregory Millman talked with executives at a number of the ECNs and provides both a quick history of their development and insight about what their emergence means, both now and in the future.

Also explored are a couple of accounting issues unrelated to Enron -- yes, they do exist. Prof. Robert Howell, who wrote about improving financial statements in the last issue, has a follow-on article about the importance of free cash flow in driving value creation. Separately, the debate over pro forma accounting has been hot for some time, though it has cooled a bit with the demise of a legion of dot-coins that made pro forma a centerpiece of their reporting. But as writers Jerry Arnold and Joseph Duggan point out, pro forma doesn't necessarily mean misleading or inadequate. Often, there may be very legitimate reasons for using it to record one-time or unexpected events, they note.

Revenue recognition, another key accounting subject, is still a source of trouble, especially for high-tech firms. Robert O'Connor, CEO of a software firm serving this market, finds many companies hampered by "an uneasy mix of financial, accounting and contract management software systems" -- a very real challenge in a time of increased scrutiny of corporate reporting.

It's been almost a year since General Electric Co. lost its bid to acquire Honeywell International on a thumbs-down vote from the powerful European Union. The environment in Europe hasn't really changed, two British writers argue, and U.S. companies need to realize that Europeans often have a considerably different view about business conduct and protections than their U.S. counterparts.

Business intelligence is a complex and shifting high-tech market that has attracted a raft of huge companies such as Microsoft Corp. and Oracle Corp. Two consultants from Bywater Inc. look broadly at the subject and offer suggestions for CFOs and others to use business process intelligence (BPI) software to create value. A separate piece looks at the looming consolidation that stalks vendors in this arena and the ensuing choices that finance professionals buying these systems are likely to face.