That's right, Integrion
Financial Network did not exactly acquire Visa Interactive. And despite the recent "acquisition" announcement by the two companies, if the truth be told, say inside sources, Visa International plunked down "in the tens of millions of dollars" to have the home banking service taken off its hands.
Visa pulled the plug-financially speaking-on Visa Interactive's development, say sources, when the company took on a technology provider and systems integrator role. "The more they got into this business, they realized how much they were building custom-designed systems. That's not Visa's business. Visa's business is connectivity and enabling. They were getting into the provider side. And the economic model became abysmal," says one source on the condition of anonymity. Visa spokesman Greg Jones denies such claims: "It had been business as usual at Visa Interactive until the day that we sold the company to Integrion."
For Integrion's part, it now has a product. "They got a reasonable back office and a lukewarm biller database file," says an industry analyst. "But the most important thing that they 'bought' is the intellectual capital of the Visa Interactive people that knew how to run a business." Integrion also now has Visa on its board with an equity position, which, says a source, creates a union rife for political jockeying. Visa- unsurprisingly-disagrees, and Integrion was unavailable for comment.
American Express has reined in
its Financial Direct offering by integrating it with American Express Financial Advisors (AEFA). The aim of the integration, says an American Express spokesperson, is to build products and coordinate marketing efforts. "Our goal is to provide consumers with value-added products, and we will do that whether it's directly, through a financial advisor or through a third party-(like) a savings and loan."
Developing Financial Direct's new role as the electronic distribution channel for AEFA is evp Brian Kleinberg, former evp in Amex's consumer card services. His appointment follows Bill Heron's resignation. Heron, who was president of Financial Direct, resigned in view of the decision to integrate.
So what's really going on? Says one source: "The real driver (for the reorganization is that) American Express had an unrealistic expectation of when this proposition would become profitable." Financial Direct was reportedly a $30 million drain on the company. And though Direct is an excellent financial advisory service, says the source, "asset management is only one component core banking services-DDA, savings, lines of credit-are what really play to a bigger audience of direct bank customers."
Have you ever wondered who caffeinated network systems? While most are aware that Sun Microsystems introduced the Java programming language, it was Marimba CEO Kim Polese, then a Sun product marketing manager, who was actually responsible for today's coffee talk.
Originally dubbed "Oak," the folks at Sun decided that naming the interactive language after wood did not capture the essence of the technology. So Polese got the engineering team juiced on chocolate and coffee and let them "riff on words." Out came Java.
-bers tfn.com
