Seeking Alpha has published a fascinating interactive Q&A session with Katie Stanton, Product Manager for Google Finance. Google entered the crowded online financial data space fairly recently, so it had to bring something new to the table just to differentiate itself from the forerunners of online finance, such as Yahoo Finance, Bigcharts, and the TheStreet.com. Google’s answer is an improved search for financial information (as expected from a company built around a search engine) as well as closer integration with video, news, and blogs — content has been largely ignored by the established financial sites, but are considered both hip and relevant in the web2.0 culture. The Google Finance people have done a wonderful job bringing their website out of the starting gates, but, as newcomers, are still playing catch-up with more established competitors and struggling to implement certain basic features which have been standard on other sites for years. Fundamental information, such as the dividend yield, and securities screeners, such as an equity screener, are two notable examples of this lag with the rest of the market. I suppose they still look to Yahoo Finance for occassional inspiration.

The Seeking Alpha interview prompted me to take a peak around the internet and see what the financial websites are doing these days. In a former professional life, I spent oodles of time developing online financial applications and checking out the competition, so this was an opportunity to see what has changed over the years. To my surprise, innovation continues at a strong pace, even among the older websites which would seem long past their prime. I thought it would be a challenge to find recent examples of innovation equivalent to Smartmoney’s interactive market maps or Clearstation’s technical analysis back in the 1990s, but a glance at some of the new features in the market disproves this assumption.
Smartmoney’s latest portfolio analysis tools and Motley Fool’s thriving CAPS service are two examples which come to mind.

What has not changed is the old industry pecking order. Aside from the many casualties of the dotcom crash, most of the larger providers are still present and, interestingly, still dominating the segments they ruled in the early days of the internet. Motley Fool still champions the common investor with its educational content, Smartmoney still holds sway with its brilliant online tools, Morningstar rules the investment fund roost, BigCharts still dominates interactive charting, and Yahoo, the godfather of online finance, still rules the market with its lively (and sometimes extremely vulgar) discussion boards. The continued reign of these websites in their respective areas is a testament to the enduring power of first-mover status.

I leave my tour of the online financial web with a sense of wonder at the continued innovation, but also a feeling of bewilderment as I realize one of the greatest problems from the 1990s remains unresolved. Despite the global nature of the financial markets, financial websites are anything but global. An an example: try to get a simple quote on the well-known Swiss watch company Swatch and, more often than not, you will be disappointed with the results. Tracking a diversified portfolio with international holdings or non-equity asset classes is an impossibilty with the current crop of financial websites. A number of websites simply act as if the non-US markets do not exist, an unforgiveable oversight in this age of global finance. Others have ventured beyond the US domestic markets, but seem confused about what to do with all that additional data. I am baffled at this myopic view of the financial markets, this strange case of provincialism on the net. Yahoo, with its breadth of international market data, currently comes closest to addressing the issue, but has done little in recent years to develop this area. The online finance space may be crowded, but it seems like there is still an enormous untapped opportunity for a globally-minded startup.