Article
ATMIA East wrap-up
ATM show spotlight stolen by man who started it all.
February 26, 2007 by Tracy Kitten — Editor, AMC
*Click here to see a slide show from the conference.
It was the show of shows in the ATM space, at least for 2007. From celebrating the 40th anniversary of the ATM's creation to marking the 10th anniversary of the ATM Industry Association - a group founded on the heels of Visa's and MasterCard's 1996 surcharging-ban lifts - last week's ATMIA Conference East in Orlando, Fla., was one of a kind.
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(Photograph by Tracy Kitten) John Shepherd-Barron, during his opening address to ATMIA. |
The 81-year-old pioneer now looks back with a smile on his face at the idea he came up four decades ago: a device that would give out cash like vending machines of the day dispensed bars of chocolate. He knew a machine that could dispense cash 24/7 would revolutionize banking - he just didn't know how far the shock-waves would be felt.
The ATM is recognized as one of the most innovative creations to come out of the 20th century. In 1994, Discovery Channel included Shepherd-Barron and the ATM in a documentary about post-World War II European inventions. The crew pegged the ATM as being the first original and revolutionary European idea to be adopted by the world since the invention of the radar in 1937. After the ATM, in the European-invention line, comes the World Wide Web.
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(Photograph by Tracy Kitten) Because of his contribution to the industry, the ATM Industry Association honored Shepherd-Barron, right, with its Lifetime Achievement Award during a banquet Feb. 22. |
Ever the visionary, he challenged the audience at ATMIA East to anticipate changes on the way for payments and cash.
"I have suggested that ATMIA embark upon research about the state of cash," he said.
Mike Lee, ATMIA's chief executive, said ATMIA has already put that idea into action.
"'The Economist' did an article this week about the end of cash … saying mobile phones for payments would overtake cash," Shepherd-Barron said. "Mobile-phone payments will have a real impact on the industry; but all the calculations suggest that the use of cash continues to grow. I don't believe cash is going anywhere, but it's something that we all need to keep a close watch on."
ATMIA, 10 years later
Mike Lee, while pausing to review the association's accomplishments, also looked forward.
"We're looking at the future of cash and e-payments," Lee said. "Cash isn't going anywhere."
But the industry is facing new challenges, especially in its mature markets. Saturation, pressing compliance mandates and regulations are having an impact. To offset those pressures, ATMIA says it is committed to spearheading ATM growth in developing markets throughout the world, namely in Asia and Africa.
Tom Harper, ATMIA's president and founder, told attendees he would like to see the global ATM market double by 2017, exceeding England-based Retail Banking Research Ltd.'s growth estimates by approximately 620,000 machines. (RBR suggests the global ATM placements will be between 2.4 million and 2.5 million by 2017.)
"Our goal is to reverse the declining growth trend in recent years. But is that actually possible?" Harper asked.
Yes, Harper says, as financial institutions grow, retailers offer more financial services and more companies target underbanked consumers.
"The ATM replacement market will grow, which will fuel the growth of manufacturers, servicers, cash providers and every segment of our industry, meaning more jobs worldwide," he said. "And ATMIA's influence and membership will grow, allowing it to better serve the industry."
Dominic Hirsch, RBR's managing director, who in October 2006 published a study about the global ATM market, said during an ATMIA presentation about the future of ATMs that he doesn't see the industry growing that rapidly, although he does admire ATMIA's tenacity.
"Surcharging is what helped the U.S. market grow," Hirsch said. "And I see surcharging helping other markets grow. You do see other markets adopting surcharging. But it's more social pressure not to charge for cash that will hinder growth. It's not always regulatory."
On a worldwide basis, ATM replacements are still more prevalent than new installations, including in the United States and the United Kingdom, where replacement shipments remain strong. But as those established markets complete their migrations to Windows, the replacement model will flatten, and the developing markets will continue to pick up on installations.
As that happens, the off-premises-to-branch installations throughout the world will more closely resemble North America, where two-thirds of all ATM placements are off-premises, Hirsch said. Branch locations, which have steadily declined since 1998 - from 73 percent to 53 percent in 2005 - will continue to be overshadowed by off-premises sites.
Advanced functions such as automated deposits at ATMs and cash-recycling are likely to have big impacts over the next decade as well, Hirsch said, especially as off-premises locations become more prevalent throughout the world.
Cash recycling will spur off-premises growth in regions like Latin America, where concerns about cash replenishment have stunted, and in some ways hindered, growth in the off-premises space, he said.
"Automated deposit and recycling have potential in North America, for banks and ISOs (independent sales organizations) as well," Hirsch added, where cost reductions and consumer convenience will have an impact.
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(Photograph by Tracy Kitten) De La Rue showed off its claim to the ATM with a wall that tracked the machine's history, from inception to today. |
A changing market
The market changes Harper and Hirsch alluded to are having an impact on North American ISOs. As ATMIA shifts its focus to encompass more global visions, it's working to find a balance with its North American membership, Harper said.
Over the last 10 years, ATMIA's membership has grown to include more than 900 members in 50 countries. The association now has chapters in the United States, its founding country, Canada, Europe, Africa, Asia, Latin America and Asia.
During the conference, the association pulled in approximately 600 global attendees and some 50 company exhibitors. And attendees like Wayne Vanderkraak, president and chief executive of Portland, Ore.-based ATM service provider Solvport, said this year's East conference was the best ATMIA show they had been to in years.
But some North American ISOs say the industry pressures affecting their bottom lines have become too great for a global organization to address. To tend to those pressures, a group of ISOs has come together to form a new ISO-oriented organization called the National Association of ATM ISOs & Operators (NAAIO). (Read more about NAAIO.)
During a kick-off meeting after ATMIA's opening reception Feb. 21, NAAIO attracted between 150 and 175 ISOs and other industry players who were interested in learning more about the organization.
"The time has come where the voices of those who actually operate ATMs unify and be heard by those who can actually have a negative impact on our industry," said Warren Cato, chief executive of Georgia-based ISO Cabe and Cato Inc. and one of NAAIO's founders. "We must become proactive and stop just reacting to issues that impact the common goals of ISO and ATM operators."
Lana Harmelink, ATMIA's international director of operations, said she hopes the two organizations can work together.
"As an independent, non-profit trade association, our mission is to promote ATM convenience, growth and usage worldwide; to protect the ATM industry's assets, interests, good name and public trust; and to provide education, best practices, (a) political voice and networking opportunities for member organizations. If NAAIO's purpose complements our own, I'm sure the industry will benefit."
Tom Mortimer, executive vice president of Bloomington, Ill.-based ISO Kahuna Business Group and the newly elected president of NAAIO, says NAAIO is open to exploring synergies with ATMIA.
From the show floor …
In honor the ATM's 40th birthday, England-based De La Rue Cash Systems had a show-stopping display that walked visitors through the evolution of the ATM. One image illustrated the route cash takes when it's dispensed from an ATM.
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(Photograph by Tracy Kitten) The route of cash was highlighted at De La Rue's booth. |
Some highlights at the booth included coin equipment that dispenses, sorts and counts. The InstaChange coin dispenser and Mach3 coin counter were two of the equipment pieces on display.
The MiniMech, which Triton Systems is using on its 9100 line, also was a highlight.
At the Triton Systems booth, beyond the 9100, Triton's best-selling ATM, and the 8100, which Triton introduced last year, the RL2000 was the focus. The RL2000, which is slated for release later this year, is designed to fill the gap between the 9100 and the RL5000, said Kurtis Johnson, Triton's senior product manager.
"The major benefit is increased functionality for the price of a 9100," he said.
The RL2000, based on Microsoft CE 5.0, comes equipped with advanced screen options and the capacity for 8,000 notes - with four 2,000-note cassettes.
Just beyond the Triton booth, attendees could check out Tranax Technologies Inc.'s replacement for the Mini-Bank 1500 - the Mini-Bank 1700, an entry-level ATM designed and manufactured by Tranax.
"It has a look and feel similar to the c4000," said Tranax president Dr. Hansup Kwon. "We are creating our own look and feel," to differentiate Tranax' products from those manufactured by Korea's Nautilus Hyosung Inc. (The two companies officially parted ways in January.)
The 1700 includes a built-in topper, a fixed cassette and greater note capacity. The new CDU also comes equipped with an anti-jamming feature that allows operators to automatically re-initialize the CDU through the touchscreen without opening the enclosure for service.
Now that Tranax is no longer shipping the Mini-Bank 1500, Nautilus Hyosung is picking up the slack. The machine, now the NH 1500, which Tranax delivered to the market until the relationship was severed, will now be directly shipped to the market by Nautilus Hyosung. And, like Tranax, Nautilus Hyosung also introduced a new product - the ACE-Q, also known as the Cash Zone, a new terminal geared toward the retail market.
The difference between the 1500 and the ACE-Q is the processor and the Windows CE platform.
"It has a more powerful engine for more functions and features," said Nautilus' Chan-gyn Park.
It comes equipped with a wider color screen, a topper that can be seen from the front and rear of the machine and a module for check-cashing functions that can be integrated into the terminal, rather than using a sidecar. Its cassettes can be upgraded to hold 6,000 notes.
Banking Executive SummaryTrends / StatisticsIndustry OrganizationsDistributors / ISO / IADRetail / Off-PremisesATM HistoryManufacturersOtherNorth AmericaLatin AmericaMiddle East & AfricaAsia, Australia & PacificBank / Credit UnionATM Industry Association (ATMIA)HyosungTranax Technologies, Inc.Triton
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