Though it remains to be seen whether money can be made in offering financial services by wireless methods, the chief vendor in the field seems to be enjoying a stint as the most popular kid in the class.

The Canadian software company 724 Solutions Inc., which helps banks offer wireless transactions, has yet to turn a profit, but it has made deals with major financial institutions, including Bank of America Corp., Merrill Lynch & Co., J.P. Morgan Chase & Co., KeyCorp, and Bank of Montreal. In the last quarter, Wachovia Corp. and went live with 724's technology.

The Toronto company reported net revenues last year of $21.2 million, up from $1.2 million in 1999. The net loss for the year was $38.7 million, up from $12 million in 1999.

"It's been an incredible time," said Greg Wolfond, the company's founder and chief executive officer. "Every wave just seems to be bigger than the last one." He said the company aims to be profitable by the first quarter of next year.

Since incorporating in 1997, the company has grown to about 730 employees, and press releases about new clients and other developments keep tumbling forth. Last week 724 Solutions announced an agreement with three business units of Citigroup (Salomon Smith Barney, Cititrade, and the Citibank credit card division) and the completion of its acquisition of Tantau Software, which makes Internet infrastructure and application products.

Among the flurry of news in the fourth quarter were plans to supply wireless technology to a Korean bank, to develop mobile commerce offerings for the Chinese-language market, and to connect to Brodia's digital wallet.

Mr. Wolfond said 724's immediate plans include intensifying its focus on brokerage, expanding overseas, and concentrating on value-added areas such as payments, purchasing, and security.

"We're not going to do everything at once," he said. "We really have to focus on the things that are important."

Another issue facing 724 Solutions and its competitors is consumer willingness to do financial transactions over wireless devices. A survey done last spring by American Banker and the Gallup Organization showed that nearly 72% of respondents who use a cell phone or personal digital assistant said they were not interested in using those devices for financial transactions.

But Mr. Wolfond pointed to statistics indicating that the number of mobile Internet users has jumped from 8.2 million worldwide last May to 27 million in January, including 2.5 million in the United States.

He said wireless will take off just as personal-computer-based Internet use did, and he predicted that wireless Internet use will surpass PC-based Internet use in the next few years.

"When people first started playing with the Internet, it was cool, it was nice, but no one anticipated it would change the way people got things done as much as it did," Mr. Wolfond said. "The same is true for the mobile Internet. The new wave of technology always takes a little bit longer than people think it will, but when it happens, it's going to happen a lot quicker than anyone expects."

However, Marianne Wolk, a managing director at the investment banking firm Robertson Stephens, said market acceptance of wireless data services has not yet been proven. Ms. Wolk said 724's acquisition of Tantau should help boost its sales to existing clients and increase the company's credibility with potential customers. But she sees investment risks associated with the company, which has never earned a profit and is operating in an extremely competitive and still largely undeveloped market.

Ms. Wolk said that since 724 relies on carrier networks for service delivery and vendors such as Palm for application delivery, it could be hurt by network or equipment problems. It also faces the possibility of competition from carriers, which could start offering their own wireless data services, she said.

David W. Wright, a software and services analyst at BMO Nesbitt Burns, said 724's targeting of large financial institutions has been wise. "What 724 has capitalized on is the idea that if they can solve the problems of Citibank or Bank of America they'll have a solution that many more financial institutions will be able to use," he said. "That's the market opportunity which seems to make sense."

Competition may come from other software firms, Mr. Wright said, and from companies' internal development teams.

Mr. Wright said the Tantau deal is expected to produce revenues this year of about $77 million, 50% more than predicted before the deal. The acquisition left 724 Solutions with a cash balance of about $200 million, up from $166 million at the end of December.

Mr. Wright said 724's trajectory has been remarkable. "This seems to be a unique company, that's for sure."

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