Remember 2001? AOL and Time Warner merged; W took one oath and inspired some others; and the USS Greeneville saved the world from a Japanese fishing boat. Way back when commissions from bank customers shopping via their Internet banking sites would solve bankers’ noninterest income worries!
Then in April 2004, I updated our loyal followers on how the core-provided Internet banking products were stomping terra over the Internet banking specialist vendors due to solid functionality, tight core integration and – maybe most importantly – low prices.
Fast forward to 2011, and my, how the mighty have fallen. The core-provided IB solutions for the most part have really blown the advantage they once had over their specialty vendor competition. The core vendors were in the position to price the snotnosed IB vendors out of the market, but instead they starved their products of life-sustaining R&D and leveled the playing field.
(For the record, my bet is on Corillian to eventually be the Anointed One, but not until it figures out how to productize the Corillian Beast and make it feasible to manage, operate and afford downstream. Though threatening to do this for years now, Fiserv hasn’t delivered.)
Some of this pushback against the core-provided IB systems is cosmetic – dated look/feel, clumsy navigation, offbeat screen organization, etc. You might think for a semi-commodity like Internet banking that cheap and tight integration would trump stunning design any day. But banks DO have their limits. Credit unions DO have standards. When things get so ugly that customers complain and kids jeer you and your bank’s clunky online behemoth, you have to think about change. Banks told the core players’ IB products that they would tolerate a little clumsiness and homeliness as long as their looks didn’t outright embarrass the banks. And now the bankers are embarrassed.The war isn’t won yet, but the specialty players for Internet banking are definitely making headway. They patiently waited as the core-based IB products collected dust. Now the most heated battles are among the fancy-boy Internet banking vendors.
While Fiserv tries to posture Corillian as Everyman’s IB system, its client base still screams Big Bank and High End. In our Internet banking system selection practice, we’re not seeing any kind of significant Corillian market momentum downstream. This product isn’t likely to spark mass appeal until Fiserv can productify Corillian and rein in the price.
A Special Note to DI’s Inside Account Reps: Will you please knock it off already with the full throttle FinanceWorks (PFM) cross sale push?! Holy crap, your clients are mocking you behind your back. I have one client whose eBanking team each takes a shot of Jager every time you utter the word “FinanceWorks” on a conference call. Sadly, they’re all awaiting liver transplants.
Q2’s To-Do list:
– Figure out how to make the PSCU reseller relationship for credit unions work.
– Build a list of successfully integrated core products as long as your arm.
– Most importantly, don’t let your breakneck sales pace break your customer service department’s neck.
Just a quick and dirty review of what I’m seeing in the trenches of the Internet banking vendor wars, GonzoBankers. More stunning takes like this to come on Twitter – check me out soon at @VendorDirt.
I’m so damn 2011! —Hodgins
Whether you’re looking to evaluate an existing technology platform or make a change, Cornerstone Advisors is at your service.We have assisted more than 125 financial institutions make educated decisions on their core and ancillary systems.
Making a switch is never an easy prospect, but Cornerstone can take some of the pain out of the process. From system evaluation, to RFP, to due diligence to final selection, conversion and contract negotiation, put our expertise to work. Cornerstone Advisors – a smart choice.