RealTime IT News

Fidelity Stays True To IBM

IBM officials said Thursday that one of the largest mortgage processing companies in the country was using its Web services middleware across its business to better serve customers.

In the coming months, Fidelity Information Services (FIS), a subsidiary of Fidelity National Financial, will broker the approximately 24 million loans it handles through seven organizations online with Websphere Application Server, Portal Server, Message Broker, and Modeler and Monitor applications.

The company also signed a deal to use IBM's DB2 database software and Rational development tools.

The contract, which IBM officials were unwilling to elaborate about beyond confirming it was a multi-million dollar deal, follows on the heels of a contract with FIS to replace its existing mainframes with three z990 mainframes capable of holding 32 processors each.

FIS officials said they are already experiencing a significant increase in the number of loans processed per minute.

"This validates the work that both IBM and Fidelity have been doing for quite some time now in finding an adequate strategy, from an architectural perspective, on the future of the trend in the back end transactions of financial institutions," Pablo Suarez, IBM banking industry global solution executive, told internetnews.com.

Last October, the two companies joined forces to create a software and services product line catering to the financial industry, using IBM's middleware software and FIS' industry-specific IT expertise.

The company planned then to start rolling out an assessment package in the Spring of this year to financial institutions. According to the contract announcement, IBM and Fidelity have been testing the new processing system at IBM research centers in Maryland and California.

The partnership comes at a good time for financial organizations looking to replace their existing systems with Web services that cut down on the paper trail and allow customers to conduct transactions via the Internet. With the economy showing signs of strength, the two companies expect to be positioned to entice potential customers who should have more spending latitude.

Financial firms are usually the first to incorporate and embrace new technologies in order to give them an edge in the industry, said Nucleus Research Analyst Kathy Quirk.

"With the increasing skills that the average user has gained now, in terms of doing business over the Internet, things that several years ago could have been a slight annoyance are now much less tolerable," she told internetnews.com. "A lot of people now expect to be able to go to a Web site and be able to fill out all the paperwork and get the information they need to make a decision in terms of who they want to go with for a mortgage."

Quirk said there are not many companies in the world that have the breadth of technology to be able to deliver a hardware, software and services package like IBM has done with Fidelity in recent times.

But that doesn't mean IBM is the only solution for large financial (or otherwise) institutions.

Quirk said BEA Systems , which IBM officials said was one of the bidders for Fidelity's contract, is a company with the software strength to bring in other companies to fill in where its product ends.

"So while IBM is very formidable in terms of the breadth of its offerings, it is still facing a lot of competition from BEA, and other vendors," she told internetnews.com. "The application platform/integration market will continue to be extremely competitive.

BEA reported Feb. 19 annual revenues of $1 billion for 2003 and key customers wins throughout the year including Toyota, Boeing, Walgreens, the U.S. Air Force, Verizon Communications and Wells Fargo.