A large telco and major bank are joining forces to create a new entity that will offer e-commerce trust services.
Telus Corp. of Burnaby, B.C. and Toronto-based Canadian Imperial Bank of Commerce will launch the new company at the end of November with the help of Verisign Inc. of Mountain, Calif., which is contributing technology and funding for the venture.
The new company will also act as the principal Canadian affiliate for Verisign, providing Web site security to enable secure e-commerce, enterprise authentication, which leverages Verisign’s public key infrastructure (PKI), and online merchant payment systems.
Both Telus and CIBC already offer PKI services in Canada separately. Their current client base will be rolled together under the new venture, said Mark Schnarr, president of Telus ventures. Telus’ customers already include Chapters.ca (now owned by Indigo), ChumCity and Hewlett-Packard.
“We very quickly came to the realization that we both had some strengths and weaknesses,” said Schnarr, “and given the size of the Canadian marketplace, it made a tremendous amount of sense for us to work together.”
Bringing in Verisign was particularly important, he said, because the company is considered to be a world leader in e-security services. “From our perspective, we felt that they would bring us leading edge services and allow us to be on the forefront of a lot new products and services.”
Telus will also invest some cash in the startup, said Schnarr. “We’re a pretty strong distribution channel. I look at these types of services being sandwhiched between hosting and applications.”
The new venture is also in line with Telus’ strategy to offer more data-related services. “We’ve already identified that enhanced data, IP and wireless services would be a big part of our future,” said Schnarr. “So it’s very logical for us to bundle this product in with the other things we’re selling.”
While security is a concern for consumers wanting purchase online, Schnarr expects more activity in the business-to-business (B2B) space than B2C.
“The kinds of services we would be providing would be authentication, verification and payment services in both B2B and B2C applications,” said Schnarr. “Quite frankly we see a lot stronger growth in the B2B side.”
Full details of the Toronto-based private company to be jointly owned by Telus, CIBC and Verisign will be announced at the end of the next month. Schnarr would not say how many employees the entity will employ, but Telus will transfer its employees already part of its PKI group.