E*Trade invests in Net services

The online brokerage continues to build out its finance portal, investing in networking infrastructure, e-mail services, and content.

2 min read
E*Trade Group today invested in three Internet services that provide networking infrastructure, e-mail services, and content for Baby Boomers, as it continues to build out its finance portal.

One of the largest online brokerages, E*Trade made strategic investments in Digital Island, Critical Path, and Third Age Media. Terms of the deals were not disclosed.

Last week, Japanese software giant Softbank made a $400 million investment in E*Trade. Company executives announced quickly thereafter that "a significant portion" of the money would go toward acquisitions and toward marketing the Internet brokerage's new "Destination E*Trade" portal. Destination E*Trade is slated to be launched in September.

Digital Island provides for E*Trade's continued use of the company's fiber network and provides "a reliable solution for global Internet applications," said Tim Ryan, an E*Trade spokesman. E*Trade is developing financial sites in Japan, Korea, and the United Kingdom, among other countries.

Critical Path is a corporate electronic mail provider that specializes in portal sites and ISPs--including @Work and TABNet. E*Trade provided investment capital for the company to upgrade its infrastructure, and Critical Path now is E*Trade's exclusive Web-based email system, Ryan added.

Third Age is a content provider focused on the Baby Boomer generation. The company's motto is "The Web--for grownups."

"Third Age complements E*Trade's existing customer base," Ryan said. "It's a market segment [made up of] active traders."

E*Trade is on an aggressive expansion course, having recently announced plans to expand abroad, offer consumer credit cards, and break into the corporate services market.

E*Trade shares finished the day down nearly 12 percent, closing at 30.5625. The stock has traded as high as 47.875 and as low as 17.375 during the past 52 weeks.