In the third week of September, leading financial services technologists were in one of two places: At SIBOS in Vienna, watching from afar as the American financial system seemed to suddenly implode, or at home, watching up-close as things fell apart. But a few hundred-mostly from the New York area-found their way to Interop New York, which was co-located with O'Reilly Media's new Web 2.0 show.

Interop New York is the infant sibling to the big technology show held in Vegas every year, but it still manages to attract all the hardware and software vendors of note. The more insightful scene was on the Web 2.0 side of the floor, where vendors were promising to create social networking sites for businesses such as banks in days, or less. Some of the players present have some big names on their customer rosters. New York-based KickApps touted on demand social and media applications built for the likes of Disney, NBC and NPR. Blogtronix was pushing its BTX Financial platform, "designed to dramatically improve the way financial service companies collaborate internally and communicate with clients." LiveWorld promises to "seamlessly overlay social networking on any Web page in minutes." Brickfish had slick marketing materials and hyped clients such as Nike, Saks Fifth Avenue, and Warner Brothers-but the closest any of them come to a financial client is Brickfish's Qualcomm, the proud owner of m-banking vendor Firethorn Holdings.

But it's not just upstarts getting into the social networking widget space. IBM took the opportunity at Interop to announce the launch of the IBM Center for Social Software, which will host research into how "workers can best use Web 2.0 applications-such as blogs, wikis and enterprise mashups-to better communicate and collaborate." Companies will be invited to send employees to a corporate residency program at the center.

To be sure, some institutions have already stuck their toes in the Facebook waters. Portland-based Umpqua has a social networking component to its small business site, and many large institutions have built nascent and less-than-compelling groups on Facebook or MySpace. One bank, Charleston, SC-based FirstFederal, even sends some customers messages via Twitter. But these efforts should mostly be considered beta versions.

Gartner recently weighed in on the topic, opining dryly that "banks are still struggling to learn how to use Web 2.0 and social technologies to personalize and animate customer experiences online," but concluding that the emergence of the new breed of vendors as potential partners, or disintermediators, means banks ought to re-evaluate their online banking strategies, and come up with a social networking plan. In case you were wondering why, Gartner says, "it has the potential to make online banking a fun and easy-to-use service." (c) 2008 Bank Technology News and SourceMedia, Inc. All Rights Reserved.

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