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Technology Stocks : CheckFree Holdings Corp. (CKFR), the next Dell, Intel? -- Ignore unavailable to you. Want to Upgrade?

To: AugustWest who wrote (4956)	4/27/1999 8:03:00 AM
From: Benny Baga	Read Replies (1) \| Respond to of 20297

CheckFree Adding New Billers Twist For Banks April 27, 1999 CFO Alert -- CheckFree plans to introduce in the fall a new model that brings the billers back in the e-payment loop, which means banks using CheckFree will almost have to use the new model and banks offering their own bill payment services, such as Bank of America, will have to follow suit to compete. But the role of consolidators like CheckFree may be short-lived in the market, perhaps opening an even bigger window for banks. According to industry analyst Avivah Litan, CheckFree, the industry leader in e-bill payment and presentment, will roll out the new model because of demand from savvy billers who now see themselves cut out of the picture. Litan, research director for Interactive Financial Services at the GartnerGroup, spoke at the Bank Administration Institute's transaction processing conference in Miami last week. The billers' demand is important because consumers are expected to want to receive and pay bills electronically, and, without billers' cooperation the former won't be possible. Litan described the move from the current model, which she calls the consolidator model, as one which brings billers in closer contact with their customers. Under the current model, customers can log onto their banks' Web sites, CheckFree's Internet site, or soon, onto an Internet portal such as Yahoo!, and pay bills without ever having seen the biller's Web site. CheckFree's new version of its software, E-bill 2.0, to be introduced this fall, will kick the customer straight to the biller's Web site, making for a new direct distribution model. That new feature is called the "customer magnet." Without it, banks could lose out on a service their customers will demand to make e-billing work ohaving as many of their bills as possible in one place. "It helps banks if they're offering that because the billers won't want to work with them otherwise," Litan said. "If I'm AT&T and I won't work with any aggregator who won't implement this feature (customer magnets), then the bank will miss out on having my bill." Litan believes that in the next four to five years, "middlemen" like CheckFree will be marginalized by technology, leading to the post office model. Middlemen will be replaced by "hubs," which could be banks, Internet portals, or aggressive financial service Web sites like Schwab. The hubs will bring consumers in direct contact with billers and financial institutions. The "flattening of the hierarchy" will be possible because of standardization in the industry, and more connections between billers and consumers and financial institutions, she said. -- E.W. [Copyright 1999, American Banker]