Last week saw the official launch of Disney+, the new video streaming service from Disney that's challenging technology companies like Netflix and Amazon.
By the numbers, it was an overwhelming success, with 10 million people signing up on the first day. But the highly anticipated launch wasn't without problems.
Disney was seemingly unprepared for its popularity, and its servers were overloaded on launch day, with many people unable to access content. Fans of "The Simpsons" complained that Disney+ was cropping out jokes and couldn't load audio commentary.
The service even experienced a data breach, with hackers stealing thousands of Disney+ accounts and posting them for sale on the dark web.
I found that the Disney+ app for my PlayStation 4 couldn't load subtitles correctly. While Disney quickly fixed the issue with an update, subtitles still struggle to keep up with the audio, my video feed frequently freezes, and fast-forwarding or rewinding the video often screws up.
Those are all relatively minor issues that haven't at all prevented me from rediscovering my love for old "Simpsons" episodes or rewatching the first two episodes of "The Mandalorian" more times than is probably healthy for an ostensibly adult man.
Disney's struggles highlight how difficult it is for large companies to move into modern technology. It's been 12 years since Netflix first started streaming video, and Disney's first attempt couldn't even get subtitles right. It turns out building a video streaming services requires more than just hiring some developers and throwing money at the project.
The Disney+ story is analogous to financial industry's own slow, beleaguered foray into digital modernity.
For example, Schwab Advisor Services announced in 2009 it would build a multicustodial portfolio management tool to compete with technology vendors like Orion, Tamarac and Black Diamond. It abandoned those plans in 2018. LPL Financial also has admitted mistakes in the rollout of its next-generation adviser technology platform, ClientWorks.
It's been more than a decade since digital advice startups hit the market, and financial institutions are still trying to match the robos' client onboarding process and mobile experience. Most are falling short.
A J.D. Power study of mobile apps from 15 of the largest brokerages firms found most are too text-heavy, lack visuals and have an overall look and feel that's outdated. Basic tasks like reviewing a portfolio or checking performance are challenging.
Perhaps it shouldn't be a surprise that it is almost 2020 and firms are still trying to nail down paperless client onboarding. Don't even get me started on the 401(k) industry.
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Part of the problem is that many firms still rely on infrastructure that is decades older than that of many technology vendors, making it more difficult to integrate the latest tools. Regulations and the general complexity of the financial services industry also don't help foster speedy innovation, and there remains a lack of consistency across the industry when it comes to data standards.
The good news for financial advisers is the industry is changing its mind on technology. At the recent T3 Enterprise conference, executives from banks, broker-dealers and large RIAs said they no longer feel the need to build everything in-house.
Realizing they simply can't keep pace with technology vendors, firms today instead are concentrating on connecting their platforms with third-party technology vendors. And the vendors, instead of trying to build all-in-one platforms, are increasingly opening up their platforms to allow financial institutions to use bits and pieces of the technology.
"If you do it right, [clients] don't need to know that there's someone else underneath. But that was a big mental shift for us," said Kirby Horan-Adams, executive vice president and director of research at LPL Financial.
At InvestmentNews' Future of Financial Advice event in July, industry leaders also said they are rethinking their business models to better support technology innovation. Rather than keep financial planning, investing, retirement and banking in completely separate silos, firms are looking at bringing the businesses together to create a unified technology experience.
"If I had to start from scratch, I certainly wouldn't be building four products. You would build one container that does portfolio construction across accounts," said Eric Lordi, managing director of wealth management and head of product development at Morgan Stanley. "It wouldn't be about discretionary versus nondiscretionary; it would be about my advice and how we're going to implement it."
While the slow progress can be frustrating for advisers, it isn't for lack of trying or serious investment by financial institutions. Success at technology is very different than success in investing, and firms are bound to slip up as they move forward.
After all, not even Disney could get it right the first time, and that's OK.