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Microsoft, Bank One Ink Online Services Pact

By Nora Macaluso E-Commerce Times ECT News Network
Dec 14, 2001 11:24 AM PT

Technology giant Microsoft (Nasdaq: MSFT) and Bank One (NYSE: ONE), the sixth-largest bank in the United States, said Friday they forged a US$30 million alliance to promote and develop online services.

Microsoft, Bank One Ink Online Services Pact

As part of the three-year agreement, Bank One plans to use a variety of Microsoft offerings, including its nascent .NET technology. The pact focuses largely on marketing tie-ins and online services geared to U.S.-based consumers and small-to-mid-sized businesses.

"Anytime two large companies get together like this, I think the consumer benefits," Yankee Group analyst Rob Lancaster told the E-Commerce Times.

Cross-Promotion

Bank One, based in Chicago, will use MSN's Marketing Advantage division to promote its financial products, and will integrate Microsoft's Great Plains software and bCentral small-business portal with its own financial offerings marketed towards small businesses, the companies said.

The bank will also use Microsoft services like .NET Alerts, which sends information to users via a PC or wireless device. In addition, Bank One will market MSN's Internet access service to its customers.

In turn, Microsoft will use some Bank One commercial products in Great Plains, and the bCentral portal will provide Bank One customers with services such as Web hosting and online scheduling. Those services will also be available via the Bank One Web site.

Looking to the future, the two companies said they plan to collaborate on a series of new products and services.

Big Commitment

Microsoft said the agreement is "one of the largest commitments" to its MSN Advantage Marketing program. As Microsoft moves to expand its online offerings, the company has been developing the Advantage digital advertising services, along with other e-commerce solutions.

"Microsoft has a strong financial services offering, through its Money section, in addition to a host of other vertical offerings Bank One can use to distribute its products and services," said Lancaster.

By allying with a bank, Microsoft will be able to cash in on a growing market for brick-and-click financial services. A survey released in August by Jupiter Media Metrix found that multichannel banks were growing faster than Internet-only banks, partly because of easier access to customer service.

Attracting Consumers

Microsoft's strategy in developing its online services is to ally with companies with the intention of building a strong base that will attract consumers. At the same time, Microsoft hopes establishing a strong consumer base will, in turn, attract more partners for its online services, Yankee's Lancaster said.

The Advantage program received a boost earlier this month when Ford Motor's (NYSE: F) Volvo division agreed to use MSN to sell a number of 2003 model vehicles. The companies said they are planning a 15-month promotional campaign for Volvo's first sport-utility vehicle, the XC90, that will allow consumers to buy the cars over MSN before they become widely available.

Banking Boost

Bank One, for its part, will be able to bolster its own online operations. The bank earlier this year merged its online subsidiary, WingspanBank.com, into its main banking division.

Bank One CEO Jamie Dimon said the company chose to ally with Microsoft because it is "the world's leader in creating technology to make life easier and better for consumers and businesses."


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