I agree that SCHW is 5 years to late in the ETF arena. I think the only reason they are entering now is that they are scared of losing assets from their open end Mutual Fund Onesource program, and SCHW is all about asset retention. The downside is that ETF's are a very low margin business compared to open end funds. Plus SCHW will never spend the money that is required to market the ETF's and/or attrract the talent to run them. In summary, I really think this is a non-event for the stock price.
Wow, are you ever wrong. Schwab entering the etf marketplace now means they are doing it right. You could have said they were 5 years too late in getting their bank open but look now, they have a profitable bank that doesnt have any toxic asset exposure. They were late, but they did it right. The ETF market really is still in its infancy, and now Schwab can see what works and what doesnt work for other companies. The ETF marketplace for Schwab is a great diversification opportunity.