As president of Schematic, a Los Angeles-based company considered the expert in the area of user interfaces on computers, phones or advanced consumer electronics devices, Richard Titus counts Microsoft among his clients, and touts the value of Yahoo Finance. He was the founder and managing director of Razorfish, one of the top dot.com consulting firms before the digital crash. Once a sound engineer for The Beach Boys, he was listed as among the 50 most influential people in Hollywood by Digital Coast Reporter. Razorfish did the early design and development of Schwab.com, and more recently his firm developed the Web sites for ABC, Comcast and Turner. He is not particularly impressed by the way financial firms, other than Schwab, are using the Internet.
Why are you so underwhelmed?
Financial firms were some of the earliest companies to get on the Net. They jumped on really early and then sort of did nothing. People like Charles Schwab built their entire businesses on the Net, but in the long term none of them are doing amazing things now.
Do you use Internet banking?
Online banking makes it very difficult for me to manage my finances through one Web site. I have to go to Schwab, First Republic, and then to credit card companies like American Express that I can’t manage through my bank site. It’s like the Internet used to be – all those walled gardens like AOL and Earthlink that didn’t talk to each other. Wells Fargo has one of the leading personal financial sites – it lets you track funds and investments you hold in different institutions. I think you will see more sites with features like that, or the business will morph into one-stop solutions like paymybills.com.
Is there hope?
Check 21 should change things tremendously. Banks have been paper based organizations, and now they will quickly become more digitally focused. Culturally that makes a big difference. The immediate practical change is that you get the benefit of fast and cheaper processing of checking, but culturally you are changing everything to electronic forms. Both here at Schematic as well as back in the Razorfish days we spent a lot of time taking data from legacy systems and migrating them to Web-enabled systems. Now many firms have completed that “heavy lifting” technical nuts and bolts work, so you will see more concentration on the user experience, where Schematic is a strong leader. Banks will learn they need to focus on customer needs, efficiency and an effective customer experience.
What do you want from an investment site?
I’d like a portal that can present everything I want to know about a firm – pricing, streaming video of all the investor presentations, press releases from two years ago, SEC filings in XML, and a way to search that one company with key words. Search is a tool where a lot of work still has to be done. Sort of a cross between Hoovers, Schwab, Morningstar and the Motley Fool.
What is Schematic doing for Microsoft?
We have designed, developed and deployed user interfaces for Xbox Live, and other advanced devices as well as on the Microsoft Windows XP Media Center platform.
Where do you see the biggest lag in technology?
Content for broadband. Twenty-nine million homes have broadband now and yet not a lot of content or sites are focused on broadband users. I blame the Internet crash and the subsequent tarring of the Internet as a failure. Internet advertising revenues have far exceeded any projections made during the dot.com revolution by at least a power of two…I have a one and a half megabyte connection in my house and the only thing I can really use it for is playing video games like Everquest or Wolfenstein. The average computer-based product development curve is two to three years, and if you look back three years, no one was spending dime one on broadband video, so you had a gap where there was no investment in infrastructure, content or platforms.
Keynote, the Internet survey firm, recently concluded that banks were missing the opportunity to cross-sell and up-sell on their Web sites. Are you surprised?
No. Most sites are pretty good at selling basic products, such as new accounts, and in the case of investment banks, stocks and mutual funds to their retail consumers. The moment you get more complex – futures, REITs, commodities – the sites fail. It is very difficult to research or buy complex financial products on the Internet. And when you look at hedges, collars, and options you are flying without a parachute, yet these are products a lot of people would be interested in. As for traditional banks, they need to really do some research and find out what their customers want. They need to offer better account management bill payment features, better customer relationship tools. I left Wells Fargo because of their poor online customer support services. I had a problem and couldn’t get anyone to email me back. The phone was impossible as I was traveling and couldn’t speak to someone during 9-5 US time.
How’s your crystal ball?
The Internet is doing to financial services what it did to travel – it is empowering the individual consumer. I think there are business opportunities for financial advisors who can serve aggregated groups of retail investors. Wireless is expanding tremendously. Consumers will use their phones for research and some trading, although now I think day traders are back in the niche where they belong. I see a massive opportunity to organize and distribute data inside firms so when you call a broker on the phone, he can get to the information readily. Bloomberg made a fortune doing it on a pretty primitive level. If I have a handheld video player, I should be able to pull all sorts of information, from stock price to product demos to relevant SEC data in XML, onto my screen.
What's your prediction on timeframes?
You have a lot of young Turks out there who are very technology friendly. I think as the older generation retires and the young Turks come in, you will see speedy adoption of technology in financial services.
You have written about changes by on-demand video, such as TiVo.
I think the bigger issue is the on-demand world. It is a change from a programmed model where someone is paid $800,000 a year to decide what program comes after another. Now Thursday is my TV night and I watch Las Vegas and West Wing, which are broadcast on different networks on different nights. I have no brand loyalty to a network.
www.schematic.com