When Horizon Lines last month carved out its nascent logistics operation into a separate business division, the ocean container line set sail into waters that are increasingly popular, and potentially turbulent.

Charlotte, N.C.-based Horizon became the latest freight transport carrier to cross the line from asset-based business to a nonasset-based operation, a boundary once clearly defined but now one that can be hard to navigate in a world of partnerships, logistics outsourcing and new carrier services that have been bending business models.

Logistics operations within companies such as UPS, truckload carrier Schneider National and others have become billion-dollar businesses in their own right.  And the maritime world, with container lines operating in the midst of the globalization trends that have extended shipper supply chains and raised the profile of logistics services, has seen carriers such as APL, Maersk and NYK Line expand large-scale logistics businesses around the globe.

But those divisions also have raised critical questions for carriers about their relationships with independent logistics companies that compete for shipper business - not to mention space on containerships - with those same logistics units.  And more voices in the freight transport world are arguing that logistics and basic transportation operations are distinctive disciplines that may operate best under entirely separate corporate umbrellas.

Global air express operator TNT, for instance, decided it was no longer enough to keep its large TNT Logistics as a separate division and carved the business up for sale.

With its focus on U.S.-based ocean business, Horizon says it's seeing many of the globalization trends in larger international shipping and that its business boundaries are as clear as the business opportunities as it looks at a new market.

"What we are trying to do here is to continue to have a company that is totally focused on its core business - liner transportation - and on the other side we want to build a very scalable logistics model," said Brian Taylor, President of the new Horizon Logistics operation.

"It's a complementary piece of business with what the liner company does. We hear from many large companies who are looking for solutions from us beyond the Jones Act transport business, solutions that require an innovative approach and a comprehensive look at where they may have pain points in the supply chain," he said.  "At the same time, there are many customers who are not doing business at Horizon and they may have many of the same pain points."

The lines between business models in the transport world are growing murkier, say experts, as shippers look for new markets and new sources for materials.

The result is that shippers with more extended supply chains are increasingly used to logistics and transportation that bend traditional models.  In fact, many come to expect it as they seek seamless distribution and what might be called logistics simplification.   As trade barriers are falling, the lines between business segments in transportation have fallen right along with them.

"Globalization is one of those overused terms, but it is a fact of life and it means you have to support a location with different languages and be able to operate across business units and across time zones," said John Murphy, Senior Director of Logistics and Transportation at software giant Oracle. "Globalization adds complexity."

Global shippers, say many transport executives, demand global strategies that blend the flexibility and innovation of nonasset-based contract logistics players with the reliability and sharp execution of asset-based carriers.

Some logistics operators disagree, however.

Ocean carriers "provide a fundamental service of basic ocean transport," said Tom Keene, Vice President of BDP Transport. "Where the fit is going forward is the question, what is the role of the logistics business and how does that affect their container line business?"

Logistics divisions, says Keene, "are another sales channel, really. What we expect first and foremost is effective transportation service.  As far as BDP is concerned, we look to the carriers to provide basic, core services.  Any other services are provided by us.  Where you are looking at partnership it may be in a particular service like priority stowage."

Dealing with a transportation company that offers competitive logistics can create a conflict, says Keene, "no doubt."

"Do you look at them more as a vendor-partner or as a competitor?   It can be a bit of a gray area sometimes.  But the ocean carriers haven''t been able to fully mirror a 4PL or 3PL's services.  Carriers today have enough challenges executing on their core services.  Why do they want to then get into logistics?

"Where we are really overmatched today is in basic ocean transport needs.  There has been a huge deterioration in services," said Keene.

Horizon has been expanding its services and its reach since an initial public offering a couple of years ago.

The carrier created its logistics division in early August as part of a larger restructuring and said it was moving in response to growing business managing inland transport and distribution for customers that use its offshore liner services.

The line between logistics and maritime transport for Horizon includes a clear geographic boundary.  Horizon Lines operates its liner business to domestic offshore markets and won't compete for logistics services in that area.  The logistics, however, can include management of goods in the Lower 48 states.

"We do have customers who value their relationship with Horizon Lines as an ocean liner company," said Taylor, whose experience includes work as an executive at Buyer's Consolidators, a division of Sea-Land. "We've had customers come to us with domestic logistics needs, customers who want us to be a player in this field and provide them a solution.

"It could be a very comprehensive transportation management program, (such as) a large construction (firm) that may need a large number of materials delivered to a job site.  It could be a customer that has a challenge delivering product to a multitude of retail receiving centers, and deconsolidating and engineering the deliveries out to stores at the proper time."

Taylor has experience in running a separate logistics unit within a larger liner business as an executive at Buyer's Consolidators. Horizon boosted its logistics capabilities with the recent buyup of Aero Logistics, which brings the staff count at Horizon Logistics to about 100, with the potential to grow as the business expands.

The company made its first move to bolster the business within two weeks of creating the logistics division by buying California-based Aero Logistics, a third-party logistics operator that specializes in the customized handling of goods.

"We believe we can build up fairly substantial line of business and not have to buy a lot of assets. We will partner with other companies where we think that will help us," said Taylor.

Partnerships, in fact, are growing as ocean carriers seek to expand their basic role as the transportation link in the supply chain by partnering with other operators.

The combined Ocean Guaranteed service offered in concert by liner company APL and trucker Con-way Freight, for instance, is on the surface a basic agreement on space, but it also allows each carrier to reach deeper into distribution channels at either end of the supply chain.  Some logistics companies would like to see more such tie-ups.

"We don't have to market capacity and we believe we can be better partners with carriers when we don't have ownership of capacity," said Monika Ribar, President and CEO of Switzerland-based forwarder Panalpina. "A logistics concept is not based on just bringing some cargo from A to B. It requires work on the process side and the technology side."

Joint marketing may have potential, but that doesn't appear to be getting more popular very fast, says BDP's Keene.

"I don't think joint sales is there quite yet," said Keene. "There is still a church-state mindset -- things are pretty separate.  I'm signing service contracts, so they know in that particular area I'm good for a couple of hundred boxes.  There is another level you can go to.  And that would have to be built on trust, on shared marketing strategies.

"We would certainly like to engage in a deeper level of partnership and have conversations with carriers who are eager to expand our relationship.  Right now, it's still somewhat vendor-customer. I would hope that one day we do move forward and go much deeper in partnering with carriers."

In the meantime, however, he said carriers must prove that cooperation and competition can exist side by side.

"We do business with carriers that have logistics companies in-house," Keene said.  But, "on the whole, we tend to partner up with carriers that share our core values.

"The role we play is that we can come to the shipper from very disparate nodes in the supply chain.  We may serve clients with warehousing and then bring in a carrier, or we may work through the client's warehouse and then work directly with the consignee. It really comes down to the specific solution that a shipper needs. It may include managing data and matching it to the flow of goods and then bringing in the transportation component with a high degree of objectivity."

Horizon, meantime, doesn't believe its own move into logistics should cause any conflicts.

"It is certainly not out of the realm that some companies may now view us as a competitor.  But that is not a business (model) we intend to pursue.  We do not intend to get involved in consolidation and forwarding.  We're not competing with our customers," said Taylor.

He said Horizon will work at least partly through partnerships with trucking companies, warehouse operators, air freight companies and other specialists to get jobs done.

And he doesn't rule out more acquisitions.

"We have obviously had numerous investment bankers approach us about logistics companies," he said.  "This is a very active space in terms of companies being bought and sold. I believe we see this as a business we want to be in and which our customers want us to be in.  There are opportunities for us to grow this and our intention is to grow it into a very profitable line of business."