RealTime IT News

CheckFree Plans $50 Million Expansion

E-commerce firm CheckFree said this week it will invest as much as $50 million on four key initiatives to capitalize on the 100 million Internet consumers it believes will be offered its electronic billing and payment services during the next 12 to 18 months.

The company said it expects to increase its subscribers by close to 67 percent during the fiscal year ending June 2000, but may suffer a temporary financial net loss in the process.

The four initiatives are: funding free introductory offers to consumers; implementing 100 top billers with dynamic electronic bills; developing new electronic commerce services; and building out infrastructure that includes an additional data center in Ohio and a customer care and payment facility in Phoenix, which could expand capacity to service seven million subscribers.

The company also filed to sell 3.8 million shares in a secondary offering; 1.375 million of which are being offered by certain selling shareholders, including 450,000 by three former members of the Integrion Financial Network.

"Last January, as soon as we announced that we had signed one of the largest Internet portals, all of the other major portals began inquiring about working with us as well," said CheckFree Chairman and CEO Pete Kight.

"Now, with our issues with Intuit completely resolved, serious discussions are under way with Internet portals and financial institutions committed to the 'Net, which together report serving more than 100 million unique consumers. This is a tremendous opportunity for us. . .We're going to make sure that we turn as many as those consumers into CheckFree subscribers as soon as we can."

CheckFree says it already has almost three million subscribers paying more than 10 million bills a month, and has signed up more than 50 of the nation's top billers. It anticipates 5 million subscribers a year from now. The company said the investments would result in an earnings loss for fiscal 2000.