Integrating ATMs with other financial channels such as teller stations and the Internet is a challenge for banks and credit unions. Adding peripherals such as an encrypting PIN pad and ensuring hardware and software compatibility makes the task even tougher.

But as ATMs become more advanced, multichannel communication will become more prevalent, according to Bob Usner, director of marketing and product management for Nexus Software, a provider of middleware for the ATM industry.

Middleware, just like it sounds, is software that fits between an ATM's hardware and new applications, ensuring accurate and timely communication.

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When a bank upgrades an ATM, it will likely run into communication barriers, Usner said. That's because banks keep their networks simple.

"Most banks have their ATMs on an independent TCP/IP network, so they don't have to worry about protecting themselves from outside security breaches," Usner said. "That's why you only have software that the system needs, to reduce the possibility that someone accidentally or inadvertently will figure out how the system is working."

Middleware allows banks to break down those communication barriers without sacrificing security.

"Regardless of what type of hardware is used underneath, and regardless of how it's all put together, middleware will fit and make the specifics work," so that peripheral software, for instance, can communicate, Usner said.

ATM operators have more options today than ever before. When they purchase new software, they don't have to worry about which company manufactured their ATM, Usner said.

The future of communication

Like the PC industry, ATMs are beginning to achieve greater flexibility where software and hardware are concerned, said Steve Grzymkowski, Diebold's senior product marketing manager for software.

"One of the advantages to using middleware is that it speeds up the process of moving our products and features to the market," Grzymkowski said. "When we're writing a new feature or even a new version of an application, we don't have to worry so much about the hardware, because we know that we have middleware."

Grzymkowski said middleware saves banks money since they don't have to worry about upgrading their entire systems when they want to make improvements. And that, along with knowing that they're investing in well-architected software, is what banks are most concerned about.

Communication between ATM networks and other channels is the way of the future, said Steve Risto, director of NCR's APTRA Software Center of Expertise. The move to Microsoft Windows-based platforms makes ATMs more like PCs - which, in turn, makes channel communication easier.

Risto, who's working with the IFX (Interactive Financial eXchange) Forum to develop a standard that makes channel integration possible, said a big advantage for the industry is that "the deployer only has to build the transaction once and then use the same content across all channels."

Until recently, he added, only a programmer with 30 years' experience in the ATM industry could write ATM applications. Now, anyone who's familiar with Java scripts can do it.