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OptConnect reports strong sales of modems that make ATMs wireless

At one time, ATM deployers had a limited use for the wireless ATMs, mostly deploying them at temporary events, such as street fairs and carnivals.

March 3, 2011

OptConnect has reported a dramatic increase in sales of its modems that make ATMs wireless. The improvement in sales supports the product's relative newness and the cost-savings associated with wireless ATMs, says an analyst and other industry observers.

OptConnect, a provider of wireless ATM connectivity, reported a 300 percent increase in sales of its wireless gateways, or modems, in 2010 compared with 2009, said Tim Matthews, co-founder and CEO of Grant Victor, OptConnect's Kaysville, Utah-based parent company.

As a result of booming sales, OptConnect has hired additional staff to accommodate the increased activity,  operations and customer support needed to meet growing demand, said Chris Baird, general manager of OptConnect.

Nicole Sturgill, research director for Banking and Cards at TowerGroup Inc., a Needham, Mass.-based research consultancy, is not surprised by OptConnect's strong growth.

"I think that makes sense. There are two implementation types. Wireless as a backup on a traditional ATM, and wireless as the only communication for a mobile ATM or an offsite ATM for which the FI [financial institution] or an ISO [independent sales organization] wants to reduce costs," Sturgill said. "Given that wireless is so new, I'm not surprised to hear that the number of installations is growing."

At one time, ATM deployers had a limited use for the wireless ATMs, mostly deploying them at temporary events, such as street fairs and carnivals, Matthews said. But as wireless operators, including Sprint and Verizon, have installed more cell phone towers that provide 4G data, or fourth generation wireless standards, connections continue to improve.

This has enabled companies to deploy wireless ATMs permanently in more remote locations, Matthews said.  NCR Corp., for example, recently announced it has a wireless ATM that banks in India that can deploy in rural locations.

The biggest factor boosting the sales of modems that make ATMs wireless is the low cost of installing a wireless modem compared with the cost and time it takes to install a landline for an ATM.

OptConnect can install a wireless modem inside an ATM with antenna for $19.99 per month on newer model ATMs with the WinCE (Windows CE) platform, compared with $40.22 per month for a landline ATM, Matthews said.  And ATMs with a legacy platform cost $24.99 to render wireless.

"Those cost savings go right to the bottom line," he said. Wireless ATMs do not need interior wiring and the expense associated with turning on a wireless ATM, which can add $400 to the bill.

"The wireless device is inside the ATM," Matthews said. "There are not any infrastructure costs, and there are no costs of installation."  Wireless ATMs have fewer skipped transactions, which occurs when a landline ATM is installed near a refrigeration unit and static affects the line.

Wireless ATMs have a 99.95 percent uptime, he added. OptConnect has deployed wireless modems in 10,000 ATMs in all 50 states.

"The wireless ATMs are not just on mountain tops. The machines have been deployed in supermarkets, including Albertsons and Krogers and other retail locations," Matthews said.