U.S. Order has formed an alliance with Colonial Data Technologies Corp. to market a new generation of screen telephones that will deliver home banking and advanced telephone capabilities.
Colonial Data, which makes and sells Caller ID and other telecommunications products, will market the new U.S. Order phones to telephone companies.
Through the partnership, U.S. Order and Colonial Data will also combine efforts in the areas of product development, manufacturing, customer service, leasing, repair, and delivery of interactive content.
John C. Backus, U.S. Order president and chief operating officer, called the alliance a cornerstone of his company's sales and marketing strategy.
Mr. Backus, like other industry observers, said he believes phone companies will play a key role in pushing screen phones into the retail market.
U.S. Order will leverage Colonial Data's existing relationships with virtually all of the seven Regional Bell Operating Companies, independent telephone companies as well as long-distance carriers.
The alliance with Colonial also builds upon a partnership U.S. Order forged with Visa last year.
In August, the Herndon, Va., screen phone company sold its electronic banking services division to Visa International, becoming the core of Visa Interactive, the business unit responsible for the card association's remote-service offerings.
U.S. Order now provides Scanfone screen phones, interactive content, and support services to Visa banks. It will soon offer these institutions a second screen phone, known as PhonePlus.
U.S. Order will release a third smart phone in the fourth quarter that will be marketed by Colonial Data. Mr. Backus predicts that in the next two years, the company will place several hundred thousand of the devices into homes. That volume of acceptance will convince retail stores to start selling them by 1997, he projects.
The new phone is geared for a broader market than its predecessors. PhonePlus, for example, specifically emphasizes banking capabilities. By contrast, the new phone will handle banking and advanced telephone company services. It will do so by incorporating an emerging transmission standard known as "ADSI."
Developed by Bell Communications Research, ADSI - which stands for "analogy display services interface" - enables screen phones to take advantage of call management capabilities, such as caller identification and call waiting.
Since these services are high-margin, the telephone companies have an interest in getting ADSI-compliant devices, including screen telephones, widely deployed.
"Ultimately, this alliance is aimed at helping the (regional Bells) initiate and grow an installed base of ADSI-enabled customers who can use the new generation of advanced network services," said Scott A. Corzine, vice president of U.S. Order.
With screen phones capable of doing banking and advanced call management, the company said it hopes the devices will be more appealing to consumers.
The new phone also will adhere to Visa's home banking technology rules, enabling the phone to be used by any bank that implements the card association's standards.
This contrasts sharply to other screen phones on the market, which use proprietary technologies that work with specific banks.
Examples include Citibank's screen phone from Philips Home Services Inc. and the screen phone from Online Resources and Communications Corp. marketed through NationsBank.
PhonePlus, scheduled to be released in mid-February, uses an early version of the Visa standard, while the new phone will incorporate the final version, said Mr. Backus.
Walter M. Fiederowicz, chairman of Colonial Data, said marketing the new screen phone will further cement the technology firm's relationships with the phone companies.
Mr. Fiederowicz said he views the screen phone as a natural extension of the products Colonial Data is already offering. Through the company's knowledge of the business side of the telecommunications industry, Colonial Data brings value to the alliance, he said.
Mr. Backus said while the deal benefits U.S. Order by giving the company a "captive channel" into the telephone industry, Colonial Data gains the potential to capture a new market with the screen phone.
"Our alliance will deliver ADSI smart phones to Colonial Data's customers faster and at a lower cost than either of us could do alone," he said.
