U.S. Previews Financial Services Strategy

Partners selling to financial services firms could soon be getting more help from Microsoft. The company has built a specialized sales force in the United States to approach customers in banking, securities, and insurance, hoping to benefit from the strong IT spending and technical savvy of those industries. If successful in the United States, the initiative will go global, so understanding it could prove important to partners who sell alongside Microsoft in financial services. However, Microsoft might have to put more effort into finance-specific solutions before its efforts have a major effect on partner fortunes.

Financial services firms are getting special attention from Microsoft because of their unique characteristics as IT customers. They spend an unusual amount on IT, US$21,000 per employee annually versus an average of US$14,000 per employee in other industries, according to the Meta Group. And the overall total is impressive: US$361 billion worldwide in 2005, according to the Tower Group. Microsoft puts its share of worldwide financial services IT spending at 1% to 2%. Factors such as the growth of online customer service and new regulatory mandates (such as the Basel II capital adequacy requirements) have prompted continued growth in spending and have created opportunities that Microsoft hopes will expand its share of the market.