Microsoft, Bank One Ink Online Services Pact

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 millionalliance to promote and develop online services.

As part of the three-year agreement, Bank One plans to use a variety of Microsoft 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 Advantagedivision to promote its financial products, and will integrate Microsoft’sGreat Plains software and bCentral small-business portal with its ownfinancial offerings marketed towards small businesses, the companies said.

The bank will also use Microsoft services like .NET Alerts, which sendsinformation 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 withservices such as Web hosting and online scheduling. Those services will alsobe 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 MSNAdvantage 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 customerservice.

Attracting Consumers

Microsoft’s strategy in developing its online services is to ally withcompanies 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. Thecompanies said they are planning a 15-month promotional campaign for Volvo’sfirst sport-utility vehicle, the XC90, that will allow consumers to buy thecars over MSN before they become widely available.

Banking Boost

Bank One, for its part, will be able to bolster its own onlineoperations. 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 Microsoftbecause it is “the world’s leader in creating technology to make life easierand better for consumers and businesses.”

3 Comments

  • From a Web Developer’s point of view, and having developed web applications in the .NET framework, I believe Bank One is moving in the right direction. I’m a follower of Microsoft internet technologies and I believe what the .NET has to offer for any business is a tremendous advantage. Given all features available in this new and advanced technology (security, web services, etc, etc), I’m sure Bank One services will improve a lot. Also, a huge %age of the developer market are developing in the .NET framework, therefore a variety of new technological concepts are immediately available for Bank One.

  • I already have started making arrangements to close my accounts with Bank One. I don’t trust Microsoft’s .Net, and I believe this will spell disaster for both Bank One and Microsoft.

    Plus, I’m happier with my new Credit Union’s online banking site. My Credit Union’s online site is much faster and doesn’t have Microsoft’s look and feel to it as Bank One slowly redesigns their online site to match Microsoft’s look and feel. I’m not impressed with Bank One’s sluggish speed and timeouts as I browse my account on Bank One.

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