The iPhone has been called the killer app for mobile banking, but online trading houses have been pushing smart phone technology the furthest, with E*Trade and TD Ameritrade releasing robust trading apps - first for BlackBerry, then for the iPhone - that are the most advanced mobile financial services on the market.
Smart phones, particularly the BlackBerry, have been a business staple for most of this decade. But this year they are poised on the edge of wide consumer adoption. "Among domestic consumers there's a conversation taking place around how to incorporate smart phones into daily life and daily business life," says Matthew Bienfang, senior research director, brokerage and wealth management at TowerGroup. According to the Kelsey Group, smart phones or data devices now comprise 19 percent of the U.S. consumer mobile market, and 50 percent of those surveyed said they intend to buy a smart device in the next two years.
This trend makes E*Trade's introduction of a free, mobile trading application called Mobile Pro - first for the BlackBerry last year and then for the iPhone in May - very timely. "Last year the BlackBerry clearly had the largest amount of demand in the smart phone space," says Paul Vienick, svp of product management at E*Trade. "But in the last year we realized that while the BlackBerry is still important, the iPhone has become very popular...and we've seen an extremely high rate of growth." The Mobile Pro application for the BlackBerry experienced two million logins from its July 2008 launch to May 2009. And in the first quarter of 2009, logins jumped nearly 30 percent, according to TowerGroup, which wrote a report on the success of the application. Meanwhile, the Mobile Pro application for the iPhone was the number one downloaded application in the financial section of the iPhone's app store for several weeks after its May debut and has been consistently in the top five downloads, Vienick says.
The Mobile Pro features for the iPhone (and iPod touch) are very similar to those for the BlackBerry. Both include access to bank and brokerage account details; charting and watch list capabilities; free real-time streaming stock and option quotes; ability to trade stocks and options, including conditional orders; ability to transfer funds between brokerage and bank accounts, including transfers to and from outside institutions; and live portfolios. "Right now, consumers are especially concerned about the state of the markets. More and more, individual investors want regular and immediate access to market information," said Michael Curcio, president of E*Trade, in a statement. And increasingly they're going to want that access through a smart phone, adds Vienick. He cites a customer survey that found that 50 percent expect the mobile channel to be the dominate way they access accounts in the near future.
Mike George of Cambridge, Mass., a retail user of the Mobile Pro for Blackberry since March, checks on his accounts every day and trades several times a week. "It's absolutely a big improvement" over accessing his account via the Web, he says; he particularly likes the ease of navigation and the ability to transfer funds between his E*Trade accounts and other financial institutions. His one quibble is he can't - or hasn't figured out how - to view his portfolio's overall performance for the day. He can see individual funds, but not the universe of funds.
Bienfang of TowerGroup says that among online brokerage firms E*Trade is the leader in promoting a mobile platform. Its main competition is from TD Ameritrade, and to a lesser extent Fidelity. All three of these firms' mobile offerings figure prominently on their Websites and marketing.
Bienfang says that E*Trade distinguishes itself in a couple of critical ways that puts it ahead of the competition: the ability to transfer funds from other institutions, and free real-time streaming market data.
For the technical platform, E*Trade chose Vaultus Mobile Technologies, a firm with a reputation for open architectures and standards, developer tools and security. But Vienick says E*Trade did not just hand off this project. The company was "very hands on with the beta release to make sure it passed the sniff test. This was not just a tool to keep up with the market, but for account access and trade access."
While the iPhone release has much the same functionality as the BlackBerry, there are a few upgrades that may soon be expanded to the BlackBerry. There are more advanced charting and watch list features, and the iPhone's accelerometer allows the user to refresh quotes and clear a trade ticket by giving the unit a shake. Coming soon, Vienick says, is the ability for users to customize their landing pages.