This is an extract from a research report dated 11/25/98 which I haven't seen posted:
Business EBPP: A Large Opportunity for EBPP Vendors
CKFR, MSFT, FDC, EDS
By receiving bills electronically, businesses can improve their ability to more efficiently monitor and rationalize expenses. There
are very few solutions for business customers at present, mostly from vendors such as Checkfree, TransPoint (the erstwhile MSFDC), EDS, Princeton Telecom, and BlueGill. While electronic bill presentment and payment (EBPP) solutions for businesses are similar in functionality to consumer EBPP solutions, they require integration with multiple business processes and back-end supporting technologies. This should present a large professional services opportunity for business EBPP vendors with strong professional services capabilities (and for specialized systems integrators), in addition to merely providing bills. We have presented a snapshot of this developing market and what it will take to reach maturity.
Business EBPP: A Large Opportunity for EBPP Vendors
52-Week 52-Week
Price High Low
Checkfree Corp. CKFR 14 1/2 31 1/2 5 3/4
Microsoft Corp. MSFT 121 11/16 120 3/16 59
First Data Corp. FDC 27 11/16 36 1/16 19 11/16
Electronic Data Systems EDS 39 15/16 50 7/8 30 7/16
In past META FACts articles, we have examined electronic bill presentment and payment (EBPP) from a consumer standpoint. However, there is a very large market opportunity for EBPP vendors to provide
EBPP capabilities to businesses as well. By receiving bills electronically, businesses can improve their ability to more efficiently monitor and rationalize expenses. While there are a number of solutions for consumer-oriented EBPP, there are very few solutions for business customers at present, mostly from vendors such as Checkfree, TransPoint (the erstwhile MSFDC), EDS, Princeton Telecom, and BlueGill.
META Group anticipates that by 2003, 90% of the 500 largest billers will deliver electronic bills to all major bill presentment services as well as offer bills on their own Web sites (for the use of both
consumers and businesses). While EBPP solutions for businesses are similar in functionality to consumer EBPP solutions, they will require integration with multiple business processes and back-end supporting technologies. This should present a large professional services opportunity for business EBPP vendors with strong professional services capabilities (as well as specialized systems integrators), in addition to merely presenting bills. We have presented a snapshot of this developing market and what it will take to reach maturity.
To maximize the utility of EBPP solutions for businesses, the following are necessary:
· Businesses must be able to visualize billing data. Data visualization tools such as spreadsheets will be necessary to observe and analyze the billing information and also to more accurately decipher large bills (many corporate bills run into hundreds of pages).
· Workflow, storage, and management of the bill will become necessary. Both billers and customers will require tools for document management, workflow, and storage for corporate bills. The workflow component will be most important; because as bills are received by businesses, they must often be separated into component parts and routed through various individuals within the customer organization for approval or management. META Group believes workflow products from vendors such as FileNET (Visual WorkFlo) (OTC: FILE-$8 13/16-Neutral), Staffware Global, IBM (NYSE: IBM-$165 3/16), Action
Technology (Metro), and Hewlett-Packard (NYSE: HWP-$63) will most likely be utilized for this purpose.
· Integration with the ERM suite will be key. Integrating EBPP solutions with financial, accounts payable, and accounts receivable components of enterprise resource management suites from vendors
such as SAP (NYSE: SAP-$42 3/16), PeopleSoft (OTC: PSFT-$21 1/2-Neutral), Baan (OTC: BAANF-$12 13/16), and Oracle (OTC: ORCL-$35-Neutral) packages will be critical for billers and larger customer organizations.
· Support for electronic payment solutions is also key. Support for initiatives such as the Financial Services Technology Consortium's echeck, which is currently under pilot by the US Government, will be integral to maximize automated bill payment processes. In addition, support for established payment mechanisms from vendors such as CyberCash will be critical.
· Online electronic commerce (EC) suites will develop EBPP capabilities. Sell-side EC solutions such as those by BroadVision (OTC: BVSN-$22 5/8), InterWorld, and OpenMarket will play a major role in providing many electronic bills at sites where they handle online EC. Many of these suites will incorporate EBPP capabilities in the future, making it easier for businesses to link them to their back-end systems. From a buy-side EC suite standpoint (for procurement purposes — vendors such as Ariba,CommerceOne, etc.), because the procurement and business process optimization function of these suites involves a sizeable EC component, they too will subscribe to EBPP functionality and will need to be integrated with back-end systems. Middleware products from vendors such as Vitria, Extricity, and Tibco will be useful in this integration.
· As DTNs evolve, they will make EBPP an imperative. As Dynamic Trading Networks (DTNs) mature through 2002, EBPP services and associated solutions will form a principal channel for value-added invoicing and payment remittance, a critical component of an EC solution. Additionally, EBPP solutions will facilitate the electronic interaction between large and small organizations within a DTN, propelled by the same forces driving adoption of Internet EDI. META Group research indicates XML and XML derivatives will form the basis for complex billing data exchanges, and will be vital to the
realization of business benefits, beyond shortened billing cycles.
META Group believes the current products and solutions for business-to-business EBPP from vendors such as Checkfree, TransPoint, EDS, Princeton Telecom, and BlueGill are limited to provisioning only
EBPP functionality, while minimally integrating with other technology solutions. It expects billers will increasingly enlist systems integrators with broad technology knowledge (such as EDS and Andersen
Consulting) to assist in designing and deploying EBPP programs. In addition, larger EBPP vendors with strong professional services capabilities will also benefit from this trend. |
