Web services are a core technology provided by the .NET Framework. By using web services, companies can more easily integrate internal applications, but they can also access services exposed by other businesses. By combining web services exposed on the Internet with internally built services, companies can create a wide variety of value-added applications. For example, a company could unify banking, electronic bill payment, stock trading, and insurance services into a single, seamless financial management portal. Another possibility is the integration of inventory control, fulfillment mechanisms and purchase-order tracking into a comprehensive supply chain management system.
A good place to understand this at www.webservices.org. This is the most common technology used to transport Web services, the Simple Object Access Protocol (SOAP). Finally, you need to know about the most common method for discovering Web services: the Universal Description, Discovery, and Integration (UDDI) specification (see www.uddi.org). The term discovery is associated with the process of searching a Web services registry to determine which Web services are available for consumption. Once you have a foundation of knowledge about the Web service framework technologies, you can move on confidently to actually consuming Web services.