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American Banker: Monday, September 30, 1996

Microsoft Ups the PC Banking Ante with Money 97

By JENNIFER KINGSON BLOOM

Launching a long-awaited assault on Intuit Inc. and its popular Quicken
system, Microsoft Corp. today releases a new version of its Money personal
financial management software, with new ways for banks to connect to it.

Microsoft executives say Money 97 is easier to use than its predecessor and
more widely available to banks.

Banks can offer Money 97 services in various ways: through processors like
Checkfree Corp., Intuit Services Corp., and Visa Interactive; or directly
through Microsoft's "open financial connectivity" standard for on-line
commerce.

Microsoft also announced that 37 banks are offering Money 97 -- roughly the
same number that today offer Quicken services -- and that at least 23 more
will offer Money 97 by yearend. "We're here today with a lot of what Quicken
is announcing they'll have a year from now," said Richard Bray, Money 97
product unit manager at Microsoft.

"What this really means is more banks will be available through Money sooner
than through Quicken." But Intuit officials said they did not feel threatened.

"What they mostly did was add a few features we already had," said Matthew
Glickman, Quicken group product manager.

Bankers planning to offer Money 97 said Microsoft's open technology standard
was a major benefit.

"We will be able to provide our customers with the same service that they're
used to, which is on-line, real-time balances," said Michael Papantoniou, a
vice president in electronic commerce at Chase Manhattan Bank.

"Microsoft Money and Quicken now have to go through Intuit Services Corp. -
that's the big difference," he said. "ISC only has start-of-day balances."

Bankers also praised Money 97 for giving prominence to bank brand names.
Customers will see their banks' logo, Internet address, and whatever other
information the bank chooses to provide.

Henry Mounger, senior vice president of consumer product development at
Deposit Guaranty National Bank in Jackson, Miss., said his own "road test" of
Money 97 convinced him the bank should offer it. Deposit Guaranty had not
previously offered Money or Quicken.

"The overriding impression I had was its ease of use," Mr. Mounger said of
Money 97. "I had never used Quicken or any other personal financial management
software before, and I was banging out reports right and left."

Mr. Mounger said the ability to offer Money 97 through Visa Interactive was
also an attractive feature.

"We're trying to maximize that vendor relationship," he said. "We obviously
recognize the fact that Quicken is a very visible product in the marketplace,
but we're not prepared at this point to go through all those operational
issues to get up and connect."

This month, Intuit announced the sale of its processing division to Checkfree.
It also announced an alternative to Microsoft's technology specification that
it dubbed OpenExchange. Mr. Bray of Microsoft said Intuit's standard is a late
entry in the race.

"They didn't announce anything new with OpenExchange -- what they were trying
to do was slow down the market because they're a year behind," Mr. Bray said.

"There's no reason for banks to wait another year, and the big banks aren't
waiting," he said. "Why should they wait for an undocumented, unpublished
format when there's one available today that they can work with?"

Mr. Glickman at Intuit said his company's open standard does the same things
as Microsoft's, "but in a much better way," offering a choice of processors
plus "a broader range of connectivity."

Mr. Papantoniou at Chase said he also viewed OpenExchange as a broader
standard, but hoped the two specifications would converge. "That would benefit
all banks," he said.

Chase, like many of the larger banks, offers both Quicken and Money options
for home banking.

Some bankers who offer both products said they were pleased with the
improvements to Money but are not taking sides in the Microsoft-Intuit
rivalry.

"The more they talk about each other, the more focus there will be on personal
financial software, and the better for me," said S. Michael Woodward, a vice
president in strategic marketing at Crestar Bank in Richmond, Va.

"We don't come out and promote Quicken over Money or BankNow" -- Intuit's
transaction-oriented offering with America Online. "I think both of them have
done a very good job." Despite some bankers' neutrality, Money 97 is
guaranteed to step up the competition for customer loyalty.

"This is going to be a really interesting season for the personal finance
software market," predicted Phoebe Simpson, an electronic commerce analyst at
Jupiter Communications in New York.

"The fact that you can download the Quicken data into Money 97 is going to be
very interesting, and will ease the entrance of anyone who is looking to
switch."

Mr. Bray said Microsoft wanted to make switching from Quicken to Money "as
easy as possible." Quicken users are being offered a $10 discount on the
$34.95 retail price of Money 97, as well as the ability to instantly transfer
all their existing Quicken files into Money 97.

Microsoft also plans to offer all comers free 90-day trials of Money 97.

Another new feature of Money 97, critical to banks and consumers, is Internet
connectivity. Users will be able to connect not only to their banks but to a
Web site Microsoft maintains that offers current stock quotations.

Mr. Glickman of Intuit said Microsoft's previous efforts to make Money widely
available had failed to dent Quicken's market share, and he predicted the same
would hold for Money 97. "We've added over a million customers in the last
year," Mr. Glickman said.

Citing numbers compiled by PC Data of Reston, Va., Mr. Glickman said Quicken
has 73% of personal financial software users, Money 23%; 4% use other types.

"Microsoft has increased its market share, but it has come at the expense of
the smaller players like (Meca Software's) Managing Your Money," Mr. Glickman
said.

Ms. Simpson of Jupiter Communications said the release of Money 97 reflected
Microsoft's belief that high-function software could double as a mass market
product.

"Intuit sees the market splitting into transactors and trackers, and Microsoft
does not buy into that, so they have worked with their product to get sort of
a blend of the two," she said. "I think it's going to be a tight race."



American Banker: Monday, September 30, 1996

Verifone Woos Banks with Personal ATM

By JEFFREY KUTLER

Verifone Inc. is claiming a breakthrough toward one of electronic banking's
holy grails: an automated teller machine in the home -- or, for that matter,
in the pocket.

The Redwood City, Calif., company is introducing Personal ATM, a palm-size
device with a smart card slot. Among other interactive capabilities, it allows
value to be loaded onto the card via telephone.

Accompanying Personal ATM, to be unveiled today at the American Bankers
Association's bank card conference in Orlando, is Verismart, a system Verifone
says will make smart cards more appealing to the banking, retailing,
telecommunications, transportation, and utility industries. While Verifone is
not the first to see the remote banking potential of plastic cards with
built-in computer chips - for example, the Dutch company Philips makes screen
telephones with smart card readers - Personal ATM may be more ready for the
mass market.

As purely a card reader -- lacking processing power, computer intelligence, or
memory, but connectable through a phone jack -- Personal ATM is so cheap that
banks ought to consider almost giving it away, said C. Lloyd Mahaffey,
Verifone's vice president of global marketing.

He would not discuss prices but said they are a stark contrast to the $100 or
$200 that screen phone manufacturers are hoping will attract widespread
acceptance, or the bare-bones $500 network computers that Oracle Corp. and
others contend are the key to mainstream Internet use.

"The consumer might pay $2 or $3 a month, not the $90 or $100 it takes to buy
some devices that we see at technology trade shows," Mr. Mahaffey said in an
interview last week. He predicted "volume deployments" of Personal ATM by
mid-1997.

He said the battery-powered device might be mailed out in a sturdy, compact
box -- under the brand name of a bank or other provider -- along with two
smart cards.

The economics are such that if a defective machine arrives, and the customer
calls to complain, the service representative will say, "Throw it away. We'll
send a new one," said Mr. Mahaffey, architect of the Verifone consumer
strategy typified by Personal ATM.

In current parlance, Personal ATM is the ultimate "thin client." That means it
is "intellectually challenged," Mr. Mahaffey said, relying on the smart card
and on-line connections for what it needs to know.

But Mr. Mahaffey said that is the key to the cost advantage through which
Verifone hopes to dominate consumer automation as much as it does the point of
sale terminal market, where its share is near 70%.

The Verismart system is designed to embed the smart card capability in devices
other than Personal ATM -- computer keyboards, telephones, television set-top
boxes. Verifone has already forged alliances with manufacturers in such
fields, including Keytronic, GTE, and Scientific Atlanta, as well as Mondex
International and smart card maker Gemplus.

At least 10 companies have signed to support Verismart, including American
Express, MasterCard, Visa, and Wells Fargo Bank.

Verifone says it is addressing some bankers' reluctance to commit to Mondex,
Visa Cash, or a competing scheme: Verismart is "device independent," meaning a
bank is not forever locked in to any smart card decision.



News Release (VeriFone): Monday, September 30, 1996

VeriFone to Develop Smart Card Applications and Services

VeriFone, Inc. (NYSE:VFI), the leading global provider of secure payment
solutions, today announced plans to develop the VeriSmart System -- the first
end-to-end system for creating smart card applications and services. VeriSmart
pilot programs are planned with leading companies throughout the world,
including American Express, GTE, MasterCard, Mondex International, Ltd.,
NIPSCO Industries, Inc., Sparbanken Bank (BABS), Sears Payment Systems (SPS),
and Wells Fargo.

The VeriSmart System will provide the applications, integration services and
marketing support required to enable these companies to offer expanded smart
card products and other services to their customers.

The VeriSmart System was announced concurrently today at the ABA Bank Card
Conference with a separate announcement from VeriFone and other leading
companies for plans to develop personal devices and information appliances
that will bring low-cost smart card capability directly to consumers.

VeriSmart, a flexible, open, smart card system, is the first solution that
will enable multiple consumer appliances, such as a personal/home ATM device,
smart phone, personal computer or set-top-box, to access a variety of smart
card applications, and seamlessly integrate with back end payment and
transaction systems worldwide.

VeriSmart, which will reside on various companies' host systems, is being
designed to allow a customer to access and interact with their accounts to
retrieve electronic cash, monitor services, pay bills, receive healthcare
information, get updates on frequent flyer awards and other personal services.

"VeriFone's Consumer Systems Division is developing the first realistic
solution that is expected to stimulate the emerging smart card market,
bringing consumers and providers together through robust, interactive products
and services for everyday banking, health insurance, and utility
transactions," said C. Lloyd Mahaffey, vice president of global marketing for
VeriFone. "The wide range of industries that are looking to implement
VeriSmart products and services indicates the enormous potential for smart
card services we can expect in the future."

The flexible design of the VeriSmart server and applications software,
installed on the provider's host computer, will readily support additional
applications and upgrades as they are developed. VeriSmart applications can
allow these providers to offer new and unique products to broaden their
customer base through value added smart card services.

"The real value of smart card technology will not be realized until consumers
have a compelling reason to change the way they conduct business today," said
Thomas Kilcoyne, general manager, VeriFone's Consumer Systems Division. "The
security, convenience and access to personal information they'll have through
their telephone, home ATM, PC or television can dramatically enhance their
relationships with providers who offer these services." Eight Major Companies
Prepare Solutions

VeriFone's Consumer Systems Division will begin working with leading providers
to develop and deploy enhanced consumer smart card-based products and
services.

"We are enthusiastic about exploring business solutions that incorporate the
VeriSmart System," said David L. Boyles, senior vice president of New Business
Ventures for American Express' Stored Value Group. "These types of products
have tremendous applicability to some of the products we will be launching in
the future. VeriSmart's open system architecture is exactly the kind of
technology that American Express is committed to applying to its global
infrastructure, so that we may ensure maximum customer satisfaction and
worldwide usability."

Sparbanken Bank (BABS), is Sweden's largest savings bank. "The VeriSmart
System will allow us to offer our customers a wide range of stored value card
applications. We look forward to working with VeriFone on this exciting new
program," said Jan Olof Brunila, vice president, Development, for Sparbanken.

"GTE is the largest publicly held telecommunications company in the world with
revenues of 20 billion dollars in 1995. It is also the largest U.S. based
local telephone company with wire line and wireless operations covering about
one third of these countries population. "GTE is interested in further
exploring this exciting new technology," said Jim Palma, senior manager, New
Product Markets.

"MasterCard is eager to test this product and offer an early pilot to our
members when it is ready," said Steve Mott, senior vice president, Electronic
Commerce/New Ventures for MasterCard International. "We believe VeriSmart
targets important emerging needs in the electronic commerce market."

Mondex International Ltd., the leading chip-card based electronic cash payment
system being introduced by institutions around the world, offers consumers a
secure and convenient alternative to cash. "This announcement marks another
important step forward for Mondex as a global electronic cash system. We are
working with VeriFone and others to deliver e-commerce applications that will
bring real benefits of convenience and security to consumers worldwide", said
Mike Young, head of New Product Development, Mondex International Ltd. "We
look forward to VeriSmart providing yet another secure path for offering
Mondex transactions over the Internet."

NIPSCO Industries, Inc., an energy-based holding company located in northern
Indiana, intends to initially offer the VeriSmart system to the broad base of
customers of its electric and natural gas utilities. "Through our strong
customer relationships, we can help the VeriFone alliance build a two-way
gateway to the home," said Barbara D. Haas, group vice president of Marketing
and Communications. "We plan to concentrate our efforts on developing ways to
use this two-way technology to read meters, automatically report electrical
outages and supply energy usage information to the customer."

SPS Payment Systems, Inc., is a provider of technology-based outsourcing
services. Principal businesses include: point of sale credit card transaction
processing; administration of consumer private label credit card programs; and
customized operating services such as help desk support and customer service.
"SPS Payment Systems has worked with VeriFone and utilized their hardware to
meet the retail point-of-sale needs of many of the clients for whom we process
credit and debit transactions. Their new VeriSmart System will represent an
opportunity for us to provide electronic payment processing through a variety
of consumer appliances such as personal/home ATM devices, smart phones or
PCs," said Patrick A. Albright, director of Industry Marketing, for SPS
Payment Systems.

Wells Fargo, a leading force behind the development of Mondex in the United
States, supports VeriFone's new technology. "The VeriSmart System is
ground-breaking technology that will significantly reduce the cost and
complexity of offering multiple applications to our Mondex customers," said
Janet Hartung-Crane, senior vice president of Wells Fargo's Electronic
Payments Division. Wells Fargo & Co., the 9th largest bank holding company in
the United States, has assets of $108.6 billion following completion of its
merger with First Interstate.


News Release (CyberCash): Monday, September 30, 1996

CyberCash Launches CyberCoin Service

Individuals can finally make small purchases on the Internet securely and
instantaneously with CyberCash's revolutionary new electronic coin service.
CyberCash, Inc. (Nasdaq: CYCH), today announced CyberCoin(TM), an innovative
payment service that enables cash transactions, typically from $0.25 to
$10.00, and can be used with funds drawn from a consumer's existing bank
account.

"CyberCoin fulfills a growing need for consumers to purchase lower-priced and
'impulse' items on the Internet -- especially digital goods and services that
can be instantaneously downloaded to your computer, such as software,
articles, research, games and music," said Bill Melton, CEO of CyberCash.
"Internet merchants must offer consumers the ability to make spontaneous,
small denomination payments on the Internet to take electronic commerce to the
next level."

CyberCoin Provides Merchants with New Opportunities

"Shopping on the Internet for low-priced items will be as easy as pulling a
coin out of your pocket at the store, newsstand, or video arcade," said Ray
Speichert, CEO of Headgames, a Web merchant who will offer the online game
Worbble, using the CyberCoin service. "With CyberCoin, players from around the
world can compete against other players on the Internet on a pay-per-play
basis."

Until now, merchants have been unable to effectively sell low-priced,
value-added products and services over the Web. CyberCoin removes this
barrier, and opens up a new world of digital commerce opportunities. A broad
range of soft goods and services can now be sold and delivered electronically,
allowing merchants to drive incremental sales of items such as newsletters,
graphic art, real-time stock quotes and virtual games.

"As the premier provider of high quality financial information, Quote.COM's
mission is to fulfill the sophisticated needs of serious investors," said
Quote.COM President Chris Cooper. "CyberCoin will add a powerful pay-per view
option for on demand purchase of financial information, giving our subscribers
even greater flexibility to manage their portfolios."

CyberCoin Opens Up the Internet for the Consumer

Free, easy-to-use and secure, CyberCoin provides consumers with a
revolutionary new way to shop online. CyberCoin can be used with any existing
bank account or major credit card -- all that is needed is an Internet Wallet,
which is free to consumers and can be downloaded from the CyberCash Web site
at (http://www.cybercash.com).

"There is undoubtedly a niche for coin payment on the Internet and CyberCash
is ahead of the pack in developing a user-friendly option for small cash
purchases online," said Parker Foley, Vice President and Director of
Electronic Commerce, First Union National Bank. "We are pleased to be among
the first to pilot this new service in 1996 and hope to offer its convenience
to our Internet customers by early next year."

Easy to download and install, the Internet Wallet is a password protected
software program that enables encrypted transactions to move between the
consumer, the merchant, and their banks. Just like an everyday wallet, the
Internet Wallet offers several types of payment options and can be used with
any major credit card in addition to the new CyberCoin payment service.

Online Shopping Made Easy With CyberCoin

CyberCoin provides the consumer with the ease and simplicity that has been
missing from the Internet shopping experience. When an individual on the Web
finds an item that he or she would like to purchase, the consumer simply
clicks on the Coin icon next to the goods. It's that simple. The entire
process takes only seconds. A complete transaction log of all purchases is
kept in the Wallet.

The consumer can easily, and at no cost, move money in and out of the Wallet
to use the CyberCoin service. The user chooses the amount of money he or she
wishes to move (in multiples of $20, up to $80), and selects whether to use
funds from a bank account or credit card. Security is ensured since the money
never leaves the bank-if the consumer's PC crashes, no funds are lost. Funds
in the CyberCash system are FDIC-insured, giving an added measure of security.
CyberCash Partners with Banks to Deliver CyberCoin Service

CyberCash will work with banks to integrate the CyberCoin technology and
services into the banks' Internet offerings for both their merchants and
consumers. Participating banks will offer the CyberCoin service to online
merchants and provide them with critical back-end processing capabilities and
access to existing financial networks. Merchants will pay the banks a
per-transaction fee, similar to a credit card transaction, to use the
CyberCoin service. CyberCash receives a fee for each transaction from the
banks.

Pricing and Availability

CyberCash's CyberCoin service is available now for banks, merchants and
consumers. First Union, First USA Paymentech, First Data Corporation and its
affiliated banks, and Michigan National Bank have already committed to offer
or pilot the CyberCoin service to merchants and/or to consumers before

the end of the year. Merchant server software is available immediately from
CyberCash on the Windows NT, Solaris and BSDI platforms, with other platform
versions available by the year-end. Consumer Internet Wallets can be
downloaded for free from the CyberCash Web site at www.cybercash.com.

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<a href="mailto:dlv@bwalk.dm.com">Dr.Dimitri Vulis KOTM</a>
Brighton Beach Boardwalk BBS, Forest Hills, N.Y.: +1-718-261-2013, 14.4Kbps