Great article on Spectrum. I believe CKFR announced screen scraping weeks ago. Interesting time line for Spectrum. Some bank bills between two banks in April; bank bills between three banks in late summer; no date for delivering non-bank bills.
Noise
CheckFree Says It Will Use Screen Scraping
Thursday, March 22, 2001
By Andrew Roth
CheckFree Corp. has confirmed that it plans to use aggregation technology to lift billing information from corporate Web sites and present it through its bank and portal partners.
The approach, a departure from the proprietary links the Atlanta company now relies on to gain access to corporate bills, threatens to eliminate an advantage that CheckFree’s would-be competitor Spectrum LLC claims to have. Coming just a week after CheckFree announced it would send bills via e-mail and offer person-to-person payments, the plan highlights a widening gap between the progress of CheckFree and the still-evolving Spectrum.
Spectrum, also in Atlanta, is building an “open switch” to let banks, billers, and consumers exchange information freely on the Internet. It plans to use the Open Financial Exchange (OFX) specification — which does not yet have a wide following — as the foundation for the system.
CheckFree is plotting a quicker end run to open communication. By going with aggregation, it expects to be able to achieve the same results without having to wait for OFX to take hold.
While OFX dictates formal conformance between consenting parties on how data should be accessed and shared, aggregation is largely achieved through screen scraping, a practice by which information is simply lifted from a Web site, generally without the site owner’s permission or knowledge.
Screen scraping will become one of CheckFree’s tools for consolidating billing information sometime this year, said David Fontaine, director of public relations. “It is somewhat of a departure from what we did in the past,” he acknowledged.
Indeed, CheckFree was a main architect of the movement toward OFX more than four years ago, along with Microsoft Corp. and Intuit Inc. At the time, aggregation through Web scraping was not seen as an option for data gathering.
Now, with resistance to screen scraping fading and CheckFree’s desire to deliver more bills online rising, aggregation has greater appeal. “If you think of where screen scraping started and where it has come, everyone is a lot more comfortable with the technology now,” Mr. Fontaine said. He added, “As we grow our billing content for consumers, it becomes even more compelling.”
CheckFree’s decision to begin screen scraping “basically displaces the need for Spectrum,” said Avivah Litan, research director at GartnerGroup in Stamford, Conn. “Spectrum is committed to an open switch — standards that only a bank can participate in. But CheckFree’s screen scraping technology says, ‘We don’t need to be part of an open switch. We will just go around it and get the data anyway.’ ”
Spectrum was formed in an attempt to use open standards to break apart CheckFree’s near monopoly, Ms. Litan said. “Now I can’t think of any advantage Spectrum has,” she said.
Paul Hughes, an analyst at Boston’s Yankee Group, said he agreed that CheckFree’s screen scraping will take away some of the competitive advantage of Spectrum’s OFX platform. CheckFree will be able to get access to billers that are not on its network without committing to an open standard, he said.
If CheckFree were to commit to an open standard, he said, it would be “opening the door to competition,” which could take away the biller relationships CheckFree has built so far.
John Perry, the chairman and chief executive officer of Spectrum, denied that CheckFree gains an advantage through aggregation.
“Just because [CheckFree] may do screen scraping in no way nullifies that we have an open platform,” he said. An open platform levels the playing field for all bill service providers and banks, he said — reducing CheckFree’s first-mover advantage.
Spectrum, founded in 1999 by Chase Manhattan Corp., First Union Corp., and Wells Fargo & Co., is testing its service with two of its three founding banks, Mr. Perry said. It plans to begin sending bills from those two banks to customers in April. The third bank will begin sending its bills to customers in late summer.
Spectrum does not yet have a deadline for sending nonbank bills to consumers through its bank members, Mr. Perry said. Even so, he is not worried by CheckFree’s head start because EBPP “adoption has not gone through the roof yet,” he said.
“At the end of the day I hope [CheckFree] is successful,” he said, “because that means the industry is successful and we are going get our share of it.”
Randy McCoy, a CheckFree executive vice president and chief technology officer, said Monday at UBS Warburg’s Financial Technology Conference in New York that Spectrum will not offer as many services as CheckFree. He pointed to CheckFree’s announcement on March 13 that customers using CheckFree will be able to receive and pay bills, and make person-to-person payments through e-mail.
Mr. Perry said that banks themselves will offer similar services. “We don’t need to become the de facto marketing arm for banks, telling them what services they need to offer. The banks at the end of the day won the customers on the merchant side and the consumer side, and it’s up to them to see how they can best use their franchise to market to those guys.” |
