Tenn. Bank, Bell South to Promote Internet Services

National Commerce Bancorp and BellSouth Corp. announced they will cross-promote Internet access and on-line banking in the Southeast.

National Commerce will offer discounted on-line banking and rebates on electronic bill payments to customers who use the telephone company's BellSouth.net Internet service.

In turn, BellSouth will promote the bank's Internet service via Netscape Communications Corp.'s browser, which it distributes to its more than 235,000 BellSouth.net users.

Except for small payments between BellSouth and National Commerce for generating traffic on each other's Web sites, no money is exchanged under the deal, said William R. Reed Jr., vice chairman of the $5 billion-asset Memphis banking company.

"It is a way of getting our name and product out in front of people a lot more quickly," Mr. Reed said.

The $14.95 start-up fee will be waived for BellSouth.net service customers who open Internet banking accounts. The bank, which uses Security First Technologies' Virtual Branch Manager and offers bill payment through Checkfree Corp., will also give away bill payment for three months and offer a $1 rebate for each of up to 10 electronic bill payments per month.

BellSouth, which charges $19.95 a month for unlimited Internet usage, will not reduce its price for National Commerce customers.

Though BellSouth has called the deal-its first such with a bank-a "preferred partnership," officials said they are discussing similar cobranding arrangements with other financial institutions.

But they expect that National Commerce's 136-branch network, which overlaps BellSouth's territory and includes 115 branches in supermarkets and other stores, will be a key asset for promoting BellSouth.net.

"We are going to be talking with National Commerce about utilizing their in-supermarket branch offices for distribution of software disks," said Andrew S. Dietz, director of product marketing for BellSouth.

National Commerce has 5,000 Internet banking users and hopes to attract more by publicizing the BellSouth service on its Web site and on automated teller machine screens and receipts, according to a BellSouth spokeswoman.

BellSouth.net, which was started in August 1996, is available in 43 cities in nine southern states-including National Commerce strongholds Tennessee, North Carolina, and Georgia. "What we bring to the table is significant reach," said Mr. Dietz.

BellSouth's members match the profile of the type of customer National Commerce is seeking, bank officials said. "Their customer base is above average, certainly higher than the local providers," said Mr. Reed. "They are more quality sensitive than price sensitive."

The Main Street sensibility engendered by a local phone company and a local bank may help draw new users-"newbies" in Internet parlance-into the on-line world.

"The phone companies traditionally rate high for security and reliability," said Gary Arlen, president of Arlen Communications Inc. in Bethesda, Md. "Putting them together with banks-another staid, solid community organization-is a very attractive deal."

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