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Paying Bills Online — Three E-Bill Distribution Models Rise to the Top
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STAMFORD, Conn., November 8, 2000 — According to a Gartner Group, Inc (NYSE: IT and
ITB) report, only 17 percent of 127 million U.S. adult Internet users are certain that they want to
view their bills online. Almost half prefer mailed bills, and the rest are unsure about their
preferences. Meanwhile a major electronic bill presentment and payment (EBPP) industry has
emerged that offers three main e-bill distribution models — electronic bill consolidation, total bill
consolidation and biller direct.
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With eight million subscribers — of which about a third are actively using the application — the
biller direct e-bill distribution model, whereby consumers view and pay bills directly on a biller's
Web site, is currently the most popular method for EBPP. Following in popularity is the electronic
bill consolidation model and the total bill consolidation model, with less than 100,000 subscribers
each.
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"Consumers are attracted to the biller direct model because the applications are free, easy to find,
easy to use and they offer frequent data updates and responsive customer service in comparison
to the consolidation models," said Avivah Litan, research director for Gartner. "Their success is
testimony that e-billing is indeed a killer application when content is compelling and consumers
can save time and money."
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Gartner research indicates a strong appetite for consolidated account and bill payment services
among consumers who bank or invest online, but high fees, inadequate customer service and
clumsy enrollment processes have kept consumers at bay. By 2004, however, as the EBPP
network and technologies mature, biller direct models will no longer be the most popular with a
projected15 million customer base, while 25 million will prefer to access all their e-bills in one
place.
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In the total bill consolidation model, consumers are presented electronic images of all their bills —
scanned paper or electronic — through a very friendly user interface. Although convenient, high
consumer fees and inconvenient enrollment, such as having to change billing addresses for bill
scanning purposes, have hindered consumer adoption.
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The electronic bill consolidator model consists of consolidators who work behind the scenes
gathering electronic bills, and offering bill presentment services through other firms that interface
directly with consumers. High fees, ineffective marketing, lengthy and confusing enrollment, and
fragmented customer service have kept enrollment low.
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About Gartner
Gartner provides unrivaled thought leadership for more than 10,000 organizations, helping clients to achieve their business objectives through the intelligent and efficient use of technology. Additionally, Gartner helps technology companies identify and maximize technology market opportunities. Gartner's technology content and strong brand reach IT professionals globally through Gartner Research, its research and advisory unit; Gartner Services, its custom consulting unit; Gartner Events, including Gartner's renowned Symposia; and at http://www.gartner.com.
Gartner subsidiary TechRepublic, Inc. (www.techrepublic.com)
is the leading online destination developed exclusively for IT professionals by IT professionals. Gartner, founded in 1979 and headquartered in Stamford, Connecticut, achieved fiscal 1999 revenue of $859 million. Gartner's 4,300 associates, including 1,400 research analysts and consultants, are in more than 80 locations worldwide. For more information about Gartner's industry-leading products and services, please visit us on the Web at http://www.gartner.com.
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