ATM Software: Trends Analysis for 2007-2008

Sponsored by KAL ATM Software
Tags: ATM History, Bank / Credit Union, North America, Software, Transaction Processing, Trends / Statistics
Type: White Paper
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The ATM industry is not one to be touted for its ability to quickly change. Rapid adoption of new technology is not something the industry does well.

Take the migration from IBM’s legacy OS/2 platform to Microsoft’s Windows. High-level ATM-industry executives and consultants have been talking about the migration for nearly a decade, but only recently has the industry begun to see some recognizable movement.

And even that has been slow.

Experts suggest that between 30 percent and 60 percent of ATMs in the United States continue to operate on OS/2. Globally, that percentage is likely a bit lower, namely because of expansion into emerging markets such as the former Soviet Union and Africa, where new Windows-based machines are the norm. But in established ATM markets, OS/2, states and screens, and a proprietary, locked-in ATM system continue to rein.

It’s no wonder that the ATM and other banking channels have resided in operational silos for so long. The whole notion of multichannel integration is one that sounds ideal in theory but remains highly unlikely in practice. Until all banking channels can speak a common language and operate on and from a common platform, enterprise-level channel integration will remain something talked about at conferences and writtten about in banking-research reports but rarely practiced in the real world.

Fundamentally, however, the industry is making some headway toward change.

The advent of Windows- based hardware has opened the doors of intra-ATM-network communication.

The notion of hardware consistency is one that banks and credit unions through-out the world are embracing. Even  in the United States, where the movement to Windows has been relatively slow, bankers are finally buying into the idea — and with it the idea of independent software.

Running a single software application across an entire ATM network was in most markets a revolutionary concept just three to five years ago. Today, it’s quickly becoming commonplace.

Michel Denis, director of engineering for Edinburgh, Scotland-based independent ATM-software provider KAL, says banks are finally buying into the whole indepen- dent, multivendor software phenomenon.

“We are finding now that banks are more aware of the importance of multivendor software, and they understand how much cost reduction they can achieve,” Denis said. “Many of them have several models of ATMs and several brands, namely because of mergers and acquisitions in the ATM space. With mulivendor software, they can buy the hardware from anyone they want without being obligated to buy software from the same provider. They are no longer locked in, and this is something they are finally starting to understand.”

As the market for multivendor ATM solutions continues to evolve and grow, so too will the industry’s thirst for knowledge about the factors driving that market, as well as the types of software the ATM industry is investing in.

To that end, ATM Marketplace expects to make its “ATM Software: Trends Analysis” guide an annual publication that reviews what happened during the previous year and reports on what industry experts anticipate for the current and upcoming years. While much of the information collected for this publication came from U.S. sources since a third of the world’s ATMs are located in the United States, ATM Marketplace and the publication’s sponsor, KAL, have approached ATM-software trends from a global perspective.

This guide features one-on-one interviews with, and in-depth commentaries from, industry experts, banking executives and ATM-industry consultants and analysts. We hope you enjoy it and will continue to inform us of your own ATM-software experiences and challenges.