News

Press Release

March 27, 2007


Subject: Expert Analyst Offers Insights on AT&T-Cingular Mobile Banking Announcement



Hello,

News broke today that AT&T's Cingular will partner with four financial institutions - Wachovia Corp., Regions Financial Corp., SunTrust Banks Inc. and BancorpSouth Inc. - to offer mobile banking services to Cingular wireless customers (a service soon to be rebranded as AT&T).

Noted wireless industry expert Bob Egan, TowerGroup chief analyst and research area director of its Emerging Technologies group, is able to provide deeper insights on what progress this move represents toward the realization of banking and payments functionality over the mobile channel.

Below are some of Egan's initial observations:

  • The agreement among this handful U.S. banks and one U.S. wireless operator represents only a small step toward true mobile banking. Banks looking to gain traction in this space must extend their reach across all the major wireless telecom providers. Forcing consumers to make a wireless operator choice does little to move the mobile banking proposition to the mainstream.
  • The key to success in mobile banking and billpay will rest with a bank's ability to market the awareness of this new capability, instill trust with the customer that a mobile phone is a secure device for banking, and finally, ensure a seamless user experience for the customer.
  • By years end, TowerGroup expects eight of the 10 largest banks to offer mobile banking and billpay of some kind. In terms of consumer adoption, Egan ultimately expects upwards to 25% of existing Internet banking customers to gravitate toward mobile banking.
  • The mobile phone as a banking device will, over time, help banks to sell more products to existing customers - given the greater frequency of interactions it will enable.
  • While many banks see an opportunity for mobile banking to reduce customer care and branch staffing costs, it's quite likely reductions in these areas will remain elusive.

Please let me know if you'd like to speak to Egan regarding the implications of this news. You can reach Lisette Kwong at +1.212.642.7753 or Lisette.kwong@edelman.com.

Thanks for your time,

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