Seeking to dispel any doubt about its prowess in Internet banking technology, Microsoft Corp. said this week that it has signed up more than 300 financial institutions worldwide for on-line services based on its BackOffice technology.

Among those on the software giant's list, spotlighted this week at the company's annual FinNet event, are SunTrust Banks' Crestar Bank subsidiary, Harris Trust and Savings Bank, Hibernia Corp., Westpac Banking Corp. of Australia, and Industrial and Commercial Bank of China.

Microsoft chief operating officer Robert Herbold said the company has come a long way from where it was five years ago, when it was primarily involved in computer desktop technology.

Its emerging strength relies more on BackOffice, with banks increasingly installing the Windows NT operating system and SQL data servers.

"It's a big number and growing fast," Mr. Herbold said of the company's financial and banking industry penetration.

Microsoft supplies 55% to 65% of bank branches in the United States, 85% in Europe, 55% in Russia, and 20 of the 27 banks in Mexico, he said.

"We're making rapid progress," Mr. Herbold said in an interview during the conference. He predicted that the effects of that progress would be felt by the longtime banking technology leader, International Business Machines Corp.

In his FinNet opening remarks, Mr. Herbold, who reports to chairman William H. Gates, said, "The key message is that Microsoft is probably in the strongest position of any vendor that can provide a complete solution to customers. Our strategy on the Internet is intended to provide consumers via software with the ability to do things in a faster, simpler way. The Internet is core to everything we do. It truly represents global connectivity."

He said entire consumer-focused industries-such as banking, automobiles, and retailing-are being reengineered for lower costs, faster service, and improved customer satisfaction. Microsoft is presenting its technology platforms as an answer to all challenges.

Mr. Herbold spoke at greater length than he had before on Passport, a soon-to-be-released, digital wallet service for one-click shopping on the Internet. He used the example to underscore another message that Microsoft has at times found difficult to get across: that it is a partner, not an enemy, of banks.

"The intent is that everyone can use it," Mr. Herbold said of Passport. "It is specifically intended for consumers to input their personal details once" and not have to retype passwords or other information in future sessions.

"The wallet metaphor may resonate with banks because they can brand it," said John Grispon, worldwide banking industry manager for Microsoft.

"Nothing we are doing is intended to compete with banks and financial institutions," Mr. Herbold said. "We hope they'll look at our tools and craft exciting ways to use them."

Mr. Grispon also reported progress on DNAfs-Distributed interNet Applications for financial services. Microsoft has formed a banking advisory council with seven U.S. banks, nine from other countries, and 15 software vendors. The members include KeyCorp, Commonwealth Bank of Australia, and BWS of Germany.

Smart Card for Windows, another Microsoft initiative, is in beta testing.

"The Internet is impacting virtually every industry," Mr. Herbold said. "There is huge potential for new consumer benefits in the financial services industry."

Mr. Herbold also said the company is "bullish" on Biztalk, an electronic commerce framework that Microsoft announced in March. Biztalk "is designed to take protocols in one industry and clip together easily to another, just like Leg-o blocks," Mr. Herbold said.

He said he views Biztalk as a way to overcome the frustrations of electronic data interchange, or EDI, systems, which are fraught with standardization and connectivity problems.

One of the "hottest applications," Mr. Herbold said, is corporate purchasing over the Internet. About 64% of corporate purchasing deployments, he said, are based on Windows NT.

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