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To: zax who wrote (16463)	9/9/1998 9:06:00 AM
From: Glenn D. Rudolph	Respond to of 164684

Financial Firms Lack Clear Strategy For Web Commerce, Study Concludes By REBECCA BUCKMAN Staff Reporter of THE WALL STREET JOURNAL Most financial companies, despite spending more money on Internet ventures, remain defensive about electronic commerce and don't have a clear strategy for approaching the Web, a study finds. The survey, to be released Wednesday by consulting firm Ernst & Young LLP, found that only 1% of the companies listed "selling more products and services" over the Internet as their chief e-commerce goal. Ranked higher were issues including retaining old customers, cited by 33% of the companies, and decreasing operational costs, named by 23%. In addition, 70% of the companies said they didn't have a pricing strategy for electronic commerce, and 40% hadn't yet integrated their Internet offerings with other distribution channels, such as centralized phone centers and automatic-teller machines. "A lot of people are just patching [the Internet] on as another stovepipe," said Ernst & Young partner Phil Lawrence, whose company polled more than 100 banks, brokerage firms, mutual-fund and insurance companies. "There's a lot of defensive posturing going on." Some companies, particularly banks, are being so conservative because they "see that by being aggressive with e-commerce, they're also sowing the seeds of their own long-term demise," because the Internet is turning many banking products into interchangeable commodities, Mr. Lawrence said. He pointed out that when respondents were asked to name the top innovators in e-commerce, they cited only one bank, Wells Fargo & Co. Other vote getters were discount-brokerage house Charles Schwab Corp., which specializes in on-line stock trading, and two nonfinancial companies: on-line bookseller Amazon.com and software giant Microsoft Corp. Still, financial companies have budgeted twice as much money, on a percentage basis, for building their e-commerce businesses in 1998 as they did last year, the study found. By 2001, the firms said they would devote about 14% of their technology budgets to Internet commerce, roughly what they spend on their branch networks today.