Microsoft will be a dominant player in the retail financial services industry within a decade, Mike Harris, deputy vice-president of internet bank Egg told the Finance Directors Forum last night.
Harris – who was also CEO of First Direct, another banking pioneer – said the US software giant had the integrated technology in place to take on other financial giants, including browsers, email and ‘electronic wallets’.
Addressing 300 FDs aboard the P&O cruise liner Arcadia, he predicted a ‘handful of global winners’ would emerge in the financial services industry. And he said Microsoft’s position as a ‘de facto monopoly’ would also work to its advantage in the financial services industry, as would its own abilities to target markets and deliver solutions.
‘Monopolies can vertically integrate and nobody else can,’ he added. ‘And by the way their strategy is touched with genius.’
Harris said Egg was already the busiest financial services website in Europe and he warned FDs that the e-business revolution was only just beginning. ‘There are many more changes to come, driven by technological advances and consumer attitudes,’ he said. ‘Everybody’s playing in the digital economy. It’s not just the dotcoms – it’s everybody.’
And he condemned the government’s role in failing to ensure that the UK is served with better internet access. ‘It is a disgrace where the UK is in broadband. It’s a public policy failure lasting ten to 15 years.’
Harris said Egg, which floated last June, should become profitable by the fourth quarter of 2001, adding that he also expected the bank to grow globally.
Meanwhile, that most loveable of ageing industrialists, Sir John Harvey Jones, was back aboard the good ship Arcadia last week, once again chairing the Forum.
Booked for his ‘extraordinary insight and unique humour’, Sir John lived up to his billing. Last year he dismissed an FD as the man who likes to say ‘no’. This year he was no less scathing.
Urging delegates not to miss the muster station drill, he suggested this particular exercise was being held at the request of the London Stock Exchange. The exchange, he quipped, was concerned that should 300 FDs drown, there would be a sudden surge in share prices.