S1 Corp. says demand is robust among banks in Asia for installations of several components of its Enterprise line at once, a sharp contrast to U.S. banks.
S1 has long said that the more Enterprise components a bank installs, the more effective they are, because the products are designed to carry information about customer interaction across channels.
Observers say U.S. banks in general are reluctant to install several Enterprise products simultaneously, but S1 said that is not the case in Asia, where several banks have signed on for two or more modules.
John Philpott, the general manager of S1 Enterprise International, said the difference is Asia's economic health.
The region's "economies certainly are doing very well and are in a growth mode," Mr. Philpott said in an interview Friday. "With the growth of those economies, you do have more competition among the banks" for deposits, and that has "led to the financial institutions really being interested in the Enterprise suite."
The most popular S1 products in Asia are its branch, call center, and sales and service products, though banks are buying other Enterprise products as well, he said. Asian banks are also increasingly targeting middle-class consumers, who are less interested in a strict transactional relationship than in a banking relationship that spans channels.
"We see, in Asia, a much heavier use of alternative channels" than in recent years, Mr. Philpott said. This trend, and the corresponding appetite for S1's products, has emerged over the past 12 months, he said.
Mr. Philpott would not name any of its Asian customers, but said S1 would probably be able to identify them once the projects get under way. He said that S1's focus is on China and Southeast Asia.
S1 expects its products to continue to sell in the region even if economic growth slows, Mr. Philpott said.
"We have a good, measured growth policy so that we don't get into a situation where … you suddenly have a service problem," he said. "It's sometimes hard to do, because you do see there is a lot of opportunity, but we want to make sure we have appropriate growth."
One key to this effort is sticking to specific regions rather than selling across the entire continent.
"Even if you look across, not just Asia, if you look at all the developing economies, there are certainly some strategic trends you're seeing that make it good to be in the bank technology space," Mr. Philpott said. "They have to take big leaps forward to be successful."
S1, of Norcross, Ga., said last month that its revenue from international operations grew 24%, to $15.7 million, in the second quarter from a year earlier. It did not break the figures down by product line.
It said revenue for its Enterprise business grew 11%, to $32 million, in the quarter, but it gave no breakdown by region.
S1's Enterprise line serves large banks; the company also has separate products for small and midsize companies that it offers through its Postilion unit. Though S1 has talked about sharing technology across the two units, the audiences and marketing for those products are largely distinct.
George Tubin, a senior research director at TowerGroup Inc., a independent research firm owned by MasterCard Inc., said that for many banks in Asia, even large ones served by S1's Enterprise unit, "their current capabilities aren't as far along as banks in the U.S., so they have more of an incentive to upgrade" multiple channels.
He added that even if they are signing up for several products at once, they may choose to stagger their implementations to avoid any complications.
"Typically an institution wouldn't install everything in bulk," he said. "It's like doing a heart and lung transplant at the same time."
If S1 can showcase some of its Asian implementations to U.S. companies, it could spur sales in its home country, Mr. Tubin said.
"The U.S. is different, but … most banks like to see other banks doing things — going out and doing it successfully — before they do it," he said. "Once they get a couple of success stories under their belt, they can share that with the industry."
