Pitney Bowes plans to launch its document-storage service, called Volly, in the second quarter of 2012. It is using the intervening months to build enough scale to convince consumers that they can go completely paperless using just its service.
"iTunes without music would not be very compelling, and" a lack of content is "the reason digital mail has not taken off," says Chuck Cordray, president of Volly at Pitney Bowes.
A year ago, Volly had no biller partners. Today, it has 22 mailing partnerships and works with 4,000 billers, Cordray says.
Its most recent partnership, signed in early November, is with Allison Payment Systems LLC, of Indianapolis, which sends 25 million pieces of mail each month and is a provider of digital bills. Pitney Bowes directly touches 74% of U.S. mail, Cordray says.
The document-storage industry has always suffered from the classic "chicken or egg" problem, analysts say. Billers are not interested in providing electronic bills unless enough consumers are willing to sign up for them. Consumers aren't interested unless they can basically flip a switch and get all of their bills in one place.
Some banks have even reported that the volume of paper they mail has risen in recent years, in part because consumers who sign up for paperless bills do not trust the digital approach enough to also opt out of paper statements.
Unlike competitors who often rely on screen-scraping to aggregate accounts and supply the bills, Volly plans to work directly with billers. To address security concerns, Volly will not require its users to enter all their account information to switch off paper. They enter the last four digits of their account numbers.
"For the consumer, this is considerably simpler than setting up a username and password," Cordray says.
Consumers pay no charge to use Volly, and there is currently no limit on how much data they can store. They can house up to seven years of electronic documents, including brokerage account statements, tax returns, and wills.
And from the outset, Volly will let consumers pay bills directly from the site. Consumers can link any bank account to pay bills via automated clearing house transfer, it says.
Competing services such as Hearst Corp.'s Manilla.com combine bill payment, bill presentment, account aggregation and document storage. Doxo Inc. forges direct deals with billers to turn off paper. Each has struggled to reach large numbers of billers and to entice consumers. "Pitney Bowes has the largest scale of billers to work with and they have always been the ones to watch in this space," says Emmett Higdon, founder and principal of Prizm Strategy, in Charlotte, N.C.
But consumers prefer to pay bills either directly at billers' sites, or by mailing checks, says Jacob Jegher, a senior analyst with the research firm Celent.
"One of the biggest challenges is the fragmented nature of all the paper that makes up the consumer's financial life," Jegher says.
Volly, like its competitors, will have an issue gaining customer recognition of its service.
"Volly and Doxo are all saying the current world of bank bill payment and the biller-direct model is not satisfactory," says Mark Schwanhausser, a senior analyst for Javelin Strategy & Research.
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