Technology giant Microsoft (Nasdaq: MSFT) and
Bank One (NYSE: ONE), the sixth-largest bank in the
United States, said Friday they forged a US$30 million
alliance to promote and develop online services.
As part of the three-year agreement, Bank One plans to use a variety of Microsoft (Nasdaq: MSFT)
offerings, including its nascent .NET technology. The pact focuses largely on
marketing tie-ins and online services geared to U.S.-based consumers and
small-to-mid-sized businesses.
"Anytime two large
companies get together like this, I think the consumer benefits," Yankee Group
analyst Rob Lancaster told the E-Commerce Times.
Cross-Promotion
Bank One, based in Chicago, will use MSN's Marketing Advantage
division to promote its financial products, and will integrate Microsoft's
Great Plains software and bCentral small-business portal with its own
financial offerings marketed towards small businesses, the companies said.
The bank will also use Microsoft services like .NET Alerts, which sends
information to users via a PC or wireless device. In addition, Bank One will
market MSN's Internet access service to its customers.
In turn, Microsoft will use some Bank One commercial products in Great Plains, and the
bCentral portal will provide Bank One customers with
services such as Web hosting and online scheduling. Those services will also
be available via the Bank One Web site.
Looking to the future, the two companies said they plan to collaborate on a series of new
products and services.
Big Commitment
Microsoft said the agreement is "one of the largest commitments" to its MSN
Advantage Marketing program. As Microsoft moves to expand its online offerings, the
company has been developing the Advantage digital advertising services,
along with other e-commerce solutions.
"Microsoft has a strong
financial services offering, through its Money section, in addition to a host of other
vertical offerings Bank One can use to distribute its products and services," said
Lancaster.
By allying with a bank, Microsoft will be able to cash in on a growing market for
brick-and-click financial services. A survey released in August by Jupiter Media
Metrix found that multichannel banks were growing
faster than Internet-only banks, partly because of easier access to customer
service.
Attracting Consumers
Microsoft's strategy in developing its online services is to ally with
companies with the intention of building a strong base that will attract consumers.
At the same time, Microsoft hopes establishing a strong consumer base will, in turn,
attract more partners for its online services, Yankee's Lancaster said.
The Advantage program received a boost earlier this month when Ford Motor's (NYSE: F)
Volvo division agreed to use MSN to
sell a number of 2003 model vehicles. The
companies said they are planning a 15-month promotional campaign for Volvo's
first sport-utility vehicle, the XC90, that will allow consumers to buy the
cars over MSN before they become widely available.
Banking Boost
Bank One, for its part, will be able to bolster its own online
operations. The bank earlier this year merged its online subsidiary, WingspanBank.com,
into its main banking division.
Bank One CEO Jamie Dimon said the company chose to ally with Microsoft
because it is "the world's leader in creating technology to make life easier
and better for consumers and businesses."
Microsoft, .Net strategy and banking together. I don't think so.
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