S1 Corp., Atlanta, the gobbler-upper of financial-oriented technology companies, now acknowledges that it is suffering from a bad case of indigestion. Having racked up $1.178 billion in losses last year, and having seen its stock plunge to $7 in early March, from a peak of $120 a year earlier, it realized something had to be done. Among its first big moves was a decision, made in December—with word leaking out more recently—that it would "sunset" its Edify retail banking platform, which it acquired in 1999 when S1 bought Edify for $345 million.S1 confirms that it has stopped development of the platform and says the sun will set for good on the Edify retail banking system software in roughly two years. Edify will continue to produce customer relationship management software, but users of the Internet software will need to find another system to power their online banking. S1 would like to migrate Edify users to another S1 product, but that may not be easy. The move has set off a scurry among its competitors to snare as many of Edify's 128 users as possible. Corillian, the upstart based in Beaverton, OR, that has rapidly been catching up to first-place S1, held a conference early last month to convince these Edify customers to switch to Corillian's Voyager system.On its part, S1 says it will be strengthened by the elimination of the Edify platform. Charles Ogilvie, S1's executive vice president for corporate strategy, says it took time to evaluate Edify because it was one of seven firms that S1 had acquired within the past 16 months and was trying to simultaneously digest. Ultimately, S1 concluded that Edify was the weakest of S1's banking software products. "The business of selling $400,000 software licenses, and then getting $1.5 million to integrate it, is not a real attractive business," says Ogilvie. "You can't get enough maintenance to support the research and development effort needed to keep the tools great and to keep the products great."Ogilvie also said that S1 was producing too many different brands of the same product. Edify's retail banking platform has the smallest customer base, so it was "a real simple choice." "We have three different product offerings [Edify, Qup and S1 Consumer Suite] that were being developed concurrently to deliver a consistent set of functionality," Ogilvie says. "And then we had to integrate wireless, telephone, Internet and branch technology on top of that. It's not efficient to develop everything three times."S1 plans to incorporate its current product offerings into one core product. Ogilvie expects to be able to keep current Edify customers by moving them to a new S1 retail banking platform.Not all in the industry are convinced that Edify customers will remain loyal to S1. "This could lead to a feeding frenzy," says Octavio Marenzi, managing director of Celent Communications, an e-finance consulting and research firm in Boston. "I can think of few better opportunities for vendors to attract new business."Corillian, for one, which describes the Edify software as "a platform with no future," says switching from Edify to Corillian is easy, noting that four financial institutions recently made the change, including giant JP Morgan Chase.Others also moved quickly since learning that Edify will no longer be developed. Dayton, OH-based NCR Corp. signed a multi-year deal with Corillian in early March to replace Edify, and use Voyager as the base engine for its Internet banking software. NCR has 150 financial institutions operating on its Internet banking software.

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