See Table of Contents for Tiburon's Online Tools & Advice Research Report Tiburon Strategic Advisors, a market research & strategy consulting firm serving a wide variety of financial institutions and investment managers, is pleased to announce the release of its new research report on Online Tools & Advice. This research release summarizes some of the report's key findings. The purpose of this report is to provide readers with an initial understanding of the online tools & advice market, including web-based technologies serving both consumers and/or financial advisors. This market is dynamic, as consumer-oriented and financial advisor-oriented products are being consolidated, and traditional software products are increasingly being moved to the web. This is the second draft of Tiburon's research on this topic. Tiburon’s first draft of this report was published in 2008; that draft consolidated prior Tiburon research into one report and was unbundled from Tiburon's equally thorough online brokerage industry report. That draft also included updated profiles of some core Tiburon clients, including Advisor Software, Morningstar, & My Vest Corporation. This is Tiburon's second draft of this report. Key Findings This report has a long list of interesting facts to share: Market History Financial services technology market developments can be organized into four successive periods of evolution, beginning with the explosion in the use of personal computers & the proliferation of desktop software use by consumers The introduction of personal computers took place from 1977-1983 Charles Schwab renames his firm after himself and turns it into the first discount brokerage firm in 1977 Charles Schwab & Company kept the reins on its Street Smart software, reserving it for skilled traders alone Between 1995 and 2000, the internet penetration in the United States tripled from less than 15% to almost half of households There were four significant components of online investing & research on the financial services landscape, including discount brokerage firms’ move to the web, the proliferation of online tools, full-service brokerage firms entering the online world, and the consumer day trading craze By 2000, over one-third of affluent consumers used the internet for financial purposes Development of new technologies emerged again in 2005 Market Definition The online tools & advice industry can be defined to include news, quotes, & media vendors and other key technologies. Market Growth There are 161 online tools & advice firms, up 20% since 2003 The number of online tools & advice clients has steadily grown to 15 million, up 25% since 2003 Online tools & advice firms generate $54 billion revenues, up 50% since 2003 Key Issues There are 239 million personal computers in use, up nearly 8,000% since 1980 and 30% since 2000 The United States’ share of personal computers in circulation has declined to just 26% from 65% in 1980 270 million personal computers are sold worldwide each year, up 67% since 2003 There are 220 million internet connections, up more than 75% since 2000 The share of US population with internet connectivity has steadily grown from 44% in 2000 to 73% in 2008 There are now 198 million broadband connections, up 400% since 2003 Broadband connections now account for 35% of worldwide internet connections, up from 35% in 2007 Future Predictions for Financial Services Industry Technology This section outlines the future predictions for the online tools & advice industry. Growing Personal Computer, Internet, & Broadband Usage The number of personal computers in circulation will likely reach 570 million by 2013, up over 100% since 2007 The number of personal computers in use worldwide will reach 2.0 billion by 2014, up over 100% from 2007 80 to 100 million personal computers will be sold each year from 2008 to 2013, up 5% per year The share of US population with internet connectivity will reach 83% by 2013, up from 70% in 2007 Broadband connections are likely to rise slowly to 95% of all internet connections by 2013, up from 79% in 2007 and 90% in 2008 The number of worldwide broadband connections should rise to 800 million by 2013, up nearly 200% since 2007 Blurring of Line Between Advisor & Consumer Technology Solutions The line between advisor & consumer technologies will blur as advisor technology gains more client interface options Rising Online Financial Services Activity & Parallel Need for in Person The number of online tools & advice firms will steadily grow to 182 by 2013, up 15% since 2007 Online tools & advice firms will generate $75 billion revenues by 2013, up 50% since 2007 The share of high net worth investors that can be considered validators is likely to reach 60% by 2010, up from 50% in 2007 Future movement in the investment market will continue to swell the ranks of the validators segment. Continued Tools & Advice Companies Consolidation In the future, there will be a proliferation of web media conglomerates that will emerge from successful surround strategies or by blending traditional & online media Recent web site acquisitions have had far more unique visitors per month than perceived acquisition interest thresholds, suggesting a trend of big web media deals Finance web sites may be attractive acquisition candidates, based on the premium margins advertisers are willing to pay to reach narrowly defined audiences such as their visitors Online Tools & Advice Venture Capital Online bond trading will likely take a step towards mainstream acceptance in the future as well One third of consumers are interested in the idea of account aggregation, but only 6% are currently using aggregation tools To better understand the developments for Online Tools & Advice, executives can purchase Tiburon's Online Tools & Advice: The Intersection of Technology & Self-Service research report where the key findings highlighted above are covered in greater detail. Please contact Sarah Sage at SSage@TiburonAdvisors.Com or 415-789-2540.