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Technology Stocks : CheckFree Holdings Corp. (CKFR), the next Dell, Intel?
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To: Sam Biller who wrote (9529)9/1/1999 10:49:00 AM
From: Sam Biller  Read Replies (1) of 20297
 
I was thinking about the shift from a per-subscriber charge paradigm to a per-transaction based one.

IMHO, this will be the single event which ignites subscriber growth. This is best illustrated by an example.

I have an computer savvy Engineer colleague who analyzes everything. He did a cost/benefit analysis on the bill payment system offered by his bank (Huntington Bank). At first they were offering web bill pay for $3/month (using CheckFree). On average he pays about 6 bills per month so he could easily justify the $3/month cost based on the "less then the cost of a stamp" argument. When they raised the fee to $5.95/month, he couldn't justify the cost since it was cheaper for him to use the USPS. He dropped the service.

If CheckFree moved to a per-transaction based service for pay anyone, my friend would re-subscribe to the Huntington (CheckFree) service. The cost per transaction needs to be somewhere around the cost of a stamp (.33/transaction). This cost would automatically be debited from the subscriber's account similar to the ATM fee a user is charged when he goes outside his bank's network.

In summary, I think the shift from a per-subscriber to a per-transaction based approach for EP is a great idea and I'm looking forward to the subscriber growth which accompanies this shift.

I hope Yahoo takes this transaction approach when they role out the bill payment portion of the service. For e-bill, the subscriber shouldn't pay any fee as the e-biller should absorb the cost.

- Sam (just some rambling on a very slow news day)
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