MADISON, Wis. – CUNA has stepped up its commitment to e-commerce over the long haul. CUNA is joining forces with one of its IT partners to form a new commerce firm, CUNA Network Services. CUNA Strategic Services Inc., the for-profit arm of CUNA, is committing $925,000 to the venture, which will give it 40% ownership in the new company. Sunstar IP Communications will be the majority owner, and is actually changing its name to CUNA Network Services. CSSI’s eCommerce division had been using Sunstar for ISP, virtual private network and Web site hosting services. CSSI, which had $4.4 million in revenue last year, is owned jointly by CUNA (51%) and the leagues (49%). CUNA President/CEO Dan Mica stressed that no CU dues money is funneled to CSSI. “CUNA Network Services has been walled off from CSSI. It will look to future needs to give credit unions at least a fighting chance with technology,” said Mica, who will be chairman of CNS. CSSI will hold four of the seven CNS board seats. “We feel very good, very confident, but with any business there is risk. We think it’s worth taking. Ultimately down the road it should be profitable, but not in the next two or three years,” said Mica. John Hobko, founder/president of Sunstar, will become president of CNS. CUNA formed an e-commerce division a few years back to focus on the burgeoning field. Mica said the CUNA eCommerce name was thrown around as a possibility, but CUNA discovered the name couldn’t be trademarked. Five of CSSI’s e-commerce staffers will be leased to CNS. The bulk of Sunstar’s 18 staff members will be directly employed by CNS. CUNA’s for-profit arm (though the name has changed over the years) has a long history of getting into businesses and eventually selling them off. It has done this with IRAs and card services to name a few. Prior to this deal CSSI consisted of 11 employees broken into two units: strategic services (six employees) and e-commerce (five employees). What remains of CSSI is its strategic alliances group which has alliances with Clarke American, Canon, U.S.A., De La Rue, Diebold, Standard Register, and others. Mica said TowerGroup reviewed the proposition before CUNA went forward. “They found the concept and basis very sound. From a personal standpoint I’ve traveled to almost every state in the U.S., and credit unions are asking for these tools,” said Mica. Mica also noted there are two or three other key players that will commit to this organization in some form in coming weeks. He would not reveal those firms at press time. According to Doug Benzine, senior vice president for the new firm, it will soon be launching a complete IT security offering, including intrusion testing, security policy assistance, and other key security solutions. [email protected]

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