Online bill payment makes strides

The day when consumers can view and pay all their bills online is moving closer.

Next week three major announcements are due from key players in "bill presentment," the practice of letting customers see monthly bills on Web sites, thus saving on postage and handling costs for billers.

Those follow an announcement this week that the largest U.S. biller, AT&T, will allow long-distance customers can see their bills on AT&T's Web site through an alliance with CheckFree. AT&T will even give customers a discounted rate if the view their bills online.

On Monday, MSFDC, a joint venture of Microsoft and giant credit card processor First Data, is scheduled to announce that several large utilities have signed up for pilot testing of its bill presentment service. MSFDC officials declined to name the utilities.

Later in the week, America Online and Internet payment firm CyberCash expect to announce a bill presentment alliance that is likely to send AOL users to Web sites of unnamed billers to see their bills.

Also on Monday, AT&T, personal financial software giant Intuit, and Just In Time Solutions will announce support for a protocol called Open Internet Billing. That in turn is part of the Open Financial Exchange protocol, designed by Microsoft, Intuit, and CheckFree as a way to exchange personal financial data online.

"Essentially, this will create a relationship with AT&T and its customers that will be beneficial to the customer," AT&T spokesman Jonathan Varman said earlier this week, referring to its deal with CheckFree. "We're ensured that our customers will get an easy and clear bill and take care of it when they want to online."

The flurry of activity coincides with next week's Billing 98 industry conference. That gathering is likely to highlight the three divergent approaches to bill-paying systems, known in the industry as "bill presentment."

The "direct" model, championed by CyberCash, lets each biller--such as a cable TV company--make customer bills available on the company's Web site. CyberCash argues that billing data is a valuable resource and strengthens a firm's relationship with its customers, but the direct model also forces consumers to visit a separate Web site for each bill.

On the other side are the models known as "thin consolidator" and "thick consolidator." In both, sites make bills from multiple companies available for consumers to view and pay. Such one-stop sites include Internet portal sites like Yahoo or Netscape and personal finance sites such as Intuit's Quicken.com.

The difference between the "thin" and "thick" models relates to how much billing data the "consolidator" sites get. MSFDC is the chief proponent of the thick consolidator model: All the billing data from a particular company is shipped to MSFDC, which posts the information on its own site and on sites of banks that are its customers.

A thin consolidator, like Quicken.com, posts only summary information on its site, such as the total bill. For details, such as all the long distance phone calls a customer makes in a month, the consumer is transferred to the phone carrier's Web site.