How banking will change as the internet grows more pervasive.

Author:Motley, L. Biff

IN A RECENT WALL STREET JOURNAL (1) ARTICLE Tony Fadell observed that we are on a very fast track in the evolution of the Internet. He believes the next phases will have extraordinarily disruptive effects on current business models. But also, for those who understand and get on this track, the rewards can be enormous. This is particularly good advice for bankers, whose product is increasingly time-sensitive digital data set in a value-added contextual information format.

As the former Apple senior executive overseeing the iPod and iPhone, Fadell's vision, though dramatic, should not be frightening for bankers. On the contrary, the impact of his vision is quite consistent with how many thoughtful banking strategists envision our future delivery system a few years from now.

Simply put, Fadell envisions a future Internet having a very different feel and role than that of today. And that it will evolve into a ubiquitous augmenter of our own intelligence--connecting everyone with everything in ways that turn passive data into timely information, which is not only useful but contextually relevant to the requestor's immediate situation.

Fadell says, "Instead of seeking it (the Internet) out, we'll be surrounded by it. And instead of extracting data from it, we'll be fed a constant stream of curated, personalized information to help us solve problems and live better."

When everything becomes connected

Imagine a woman shopper at an Apple store who stumbles across a close-out price on an Internet connected AC/heating system thermostat but who doesn't have enough buying power on her credit or debit card. In Fadell's vision, your bank would be aware of her mall location, anticipate the need for additional credit, and have already sent a conditional credit extension on her iPhone.

This may sound rather futuristic, but consider Google's recent overhaul of its algorithm to prioritize search results in favor of "mobile-friendly" websites. That is, websites that are specifically formatted for the tiny screens on cell phones. According to a recent article in the American Banker (2), a sample of 25,000 websites, including banks, were tested and 40 percent flunked, largely because the sites were designed with lots of graphics for the desktop, then presented as-is on the phone, where they made navigation difficult and alienated users.

According to the article, 90 percent of the time sites are far from OK because everything is tiny and navigation nearly...

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