Harbinger EDI Services Inc., a worldwide provider of electronic data interchange services, has created a unit to focus on developing services for the Internet.

The Atlanta-based company, an EDI "value added network," facilitates business-to-business communications and the exchange of nonfinancial data such as purchase orders and invoices.

In addition, over $1 billion in automated clearing house transactions flow through Harbinger's network each month.

With increased bank participation in the web of loosely connected computer networks that make up the Internet, Harbinger believes there will be a large market for the wares of the new division.

"We see the Internet as something that will be significant in the business market, and (we) want to be positioned to offer products when the network is ready," said Robert Bower, vice president of marketing at Harbinger.

Mr. Bower says the Internet still poses some obstacles to corporate use, such as poor customer service and low transaction security. But the interest companies are showing in the so-called information superhighway are expected to boost traffic once these problems are resolved.

Harbinger provides cash management software as well as electronic commerce services such as E-mail, electronic catalogues and bulletin boards, imaging, and multimedia.

Mr. Bower said the new division, Harbinger Group Operations, and the recently acquired EDI division of Texas Instruments will help Harbinger offer a "top to bottom" EDI solution.

He said the company's mission is to EDI-enable the business community with PC-based solutions.

The former Texas Instruments division provides high-end products for large customers - typically big companies with thousands of trading partners. Their systems are built for mainframes or high-end client-server and Unix systems, said Mr. Bower.

The new division will fill in EDI service gaps by focusing on emerging technologies such as the Internet. Harbinger plans to develop end user software products that aid business-to-business transactions over the network, he said.

"In the last 18 months, the financial community has become very active in EDI, and is looking to Harbinger to provide value-added services to their own customers," said Mr. Bower.

Heading up the new Harbinger division will be James Davis, who had been president and chief operating officer of Harbinger EDI from January 1989 to December 1993, before leaving to investigate opportunities in the evolving information services market.

In his new position, Mr. Davis will consolidate strategic efforts that focus on emerging technologies. He will also maintain responsibility for special project groups, the integration of the Texas Instruments acquisition, and international activities.

The company's international initiatives include a relationship with Sprint Corp., which sells EDI network software internationally.

Harbinger has EDI implementations in China, Poland, and Canada. The company would to expand aggressively throughout Europe and into South America, Mr. Bower said.

Harbinger's competitors include the top three EDI value-added network providers, based on revenue derived from EDI: General Electric Information Services, Advantis - a joint venture between International Business Machines Corp., and Sears, Roebuck & Co. - and Sterling Software Inc., according to Gartner Group research.

Value added network providers are potential competitors of so-called "value added banks", which offer access to networks for settlement services and for non-payment transactions as well.

But, experts say, the success of the Internet likely will change the face of this competition, as banks and other parties continue to explore use of the network for financial transactions, making value added networks replaceable.

As indicated by Mr. Bower, a lack of security on the Internet persists and stymies use among corporations, but a number of software companies, in conjunction with banks, are working on solutions.

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