Tuesday, July 24, 2001

Bottomline patents payment messaging system

Published in Interface Tech News

PORTSMOUTH, N.H. ‹ Moving to protect its electronic invoicing and payment software for businesses, Bottomline Technologies received a patent in late June for its e-payment notification system. The system, called ERADS (electronic remittance advice delivery system), is already distributed as part of Bottomline's PayBase payment-automation software.

Bottomline chairman and CEO Dan McGurl said ERADS makes it easier for both parties to know what transactions have occurred.

"When you make an electronic payment," McGurl said, "there are certain limitations that do not allow organizations to send all the remittance information with the payment. (ERADS) is a real-world technology that enables organizations to work around the limitations."

Bottomline still has about 20 patents pending, McGurl said, all of which are for aspects of the company's e-payment and e-invoicing products. The protection offered by a patent improves what McGurl said is the company's already-strong position in the marketplace.

Bottomline's major initiative of late has been moving from a client-server style system to a Web browser-based implementation, a project McGurl is pleased with."We have substantially strengthened our product line with this Web-based (system)," he said.

Harry Wollhandler, vice president of research at Peterborough, N.H.-based ActivMedia Research, agreed. "The systems they've developed meet the criteria of the marketplace rather well," Wollhandler said.

The issue now for Bottomline, Wollhandler said, is to see how the market standards develop. If Bottomline's products can work with most companies' accounting systems, Wollhandler expects them to do well.

"The issue is critical mass. Can you get enough partners involved?" he added.

Bottomline is making an effort, according to McGurl said. FleetBoston, Citibank, and UPS all use Bottomline products and resell them to their customers.

The opportunity is real, Wollhandler said, for systems like Bottomline's to really take off. "Bill presentment is hard for banks," he said. "In terms of corporate business, (systems like ERADS) start to bypass the credit card, saving 2.3 percent on every transaction."

Wollhandler said Bottomline, which will announce its annual financial report in the first week of August, is moving in the right direction.

"Too many companies have gone after investors at the expense of going after customers. The strategy they seem to be putting into place is going after customers and letting investors take care of themselves," Wollhandler said.