Springfield-based EF Hutton expands into mobile phone service

Credit: DaytonDailyNews

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Local officials welcomed financial firm EF Hutton America to downtown Springfield Friday.

Credit: DaytonDailyNews

EF Hutton America will branch out into the mobile phone business, company leaders said Thursday.

The downtown Springfield company focuses on online finance and investment services, but will begin offering mobile phone services beginning in April. The mobile platform will work with customers’ existing phones or EF Hutton will provide a new phone at an additional charge of between $5 to $25 per month, depending on the phone.

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The product isn’t an app. Instead, it’s an overlay that works on a phone’s operating system, CEO and Presidents Chris Daniels said.

“A whole set of (financial tech) companies are trying to get a means of delivering service directly to consumers and our platform is forward-looking in the sense it provides a platform that is unique for a number of emerging technologies,” Daniels said.

The products make sense because of the value it provides customers who trade frequently, Daniels said. For investors who pay $70 or more each month for trades, he said it’s essentially a free phone.

The service is uncommon in the industry, analysts said. But it’s not clear if demand for that service exists, said Alois Pirker, research director for the Aite Group’s Wealth Management practice.

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“I have not seen the combination of mobile service and financial services much before and I am not convinced that consumers are making these purchasing decisions together,” Pirker said. “Despite that the price point makes sense, but only if both components are offered at the level of quality that consumers expect. Offering a bundled price advantage alone will not do the trick.”

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EF Hutton Tower. Bill Lackey/Staff

EF Hutton Tower. Bill Lackey/Staff

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EF Hutton Tower. Bill Lackey/Staff

The EF Hutton Unlimited Plan begins at $69 per month and includes unlimited talk, text and trades, according to the company’s website. It’s marketing the product through EF Hutton Mobile, a subsidiary of EF Hutton America. The price increases to $99 per month for new customers after April. Two gigabytes of data use is includes, and Daniels said it will cost an additional penny and a half per megabyte after that.

Customers can select voice and data service with carriers on the platform, which EF Hutton says includes Sprint and Verizon.

“We’ve got a whole set of features that are available pre-loaded on the phone,” Daniels said

For customers who choose to keep their own phones, the software will be delivered through a SIM card.

“There is no other financial provider we’re aware of that does anything like this,” Daniels said. “It’s really groundbreaking and really disruptive within the marketplace.”

READ MORE: Springfield to offer up to $238K a year in incentives to EF Hutton

Daniels and Casey Willman, vice president of investment services for the company, were promoting the new service Thursday at the Moneyshow Orlando, a conference for investors and traders. Customers will be able to order the service from the company’s website, but the online order form was unavailable late Thursday afternoon.

“If somebody trades just a few times a month, they effectively end up getting the phone for free,” Daniels said.

Local leaders in Clark County have banked on the company to bring new jobs and investment in downtown Springfield. The company has bought two downtown buildings and said it plans to invest $22 million and add up to 400 new jobs in Springfield over the next five years.

It has also faced challenges in its first few months, including losing two months of business last year after company officials said EF Hutton America was the victim of an Internet marketing scam. The firm's office area was also vandalized and it has been sued by a former executive in federal court.

Daniels said the company has fewer than two dozen employees currently but declined to discuss specific employment numbers.

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