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Hey Wally, what’s up?

February 27, 2012 by Richard Buckle — Founder and CEO, Pyalla Technologies, LLC

What the heck is happening at Australia’s banks? And what value would anyone place on the robustness of their ATM networks? If you haven’t been following the news, since 2010 a litany of outages has had those living in the Antipodes scratching their heads. As much as Australia prides itself on its technology prowess, confidence is at an all-time low, I would have to suspect.

Before anyone begins to tell me to stay away from this story, let me remind readers that I remain loyal to all things Australian — even the cricket — being a U.S. resident of Australian extraction. So to some extent, I feel somewhat embarrassed as I follow the local newspapers and hear the many comments that come my way. But is Australia’s IT infrastructure really beginning to unwind?

Looking back through published articles, it was Westpac that perhaps started it off when, in May 2011, their ATMs, EFTPOS facilities and website crashed. "Glitch hits Westpac’s electronic banking," was how Melbourne’s daily newspaper, The Age, broke the story. "The outage crippled Westpac and St. George services, including ATMs, and affected train customers in New South Wales and Victoria, with the bank blaming a fault at a data center." According to some TV accounts at the time, this involved failing A/C systems that brought down the IBM mainframes, although the reports didn’t identify sources.

In November 2011 it was the National Australia Bank at the center of the ruckus, as reports surfaced about "an IT glitch that left many customers short of funds" as one news source observed before adding, "The bank says there have also been delays for some NAB EFTPOS, ATM and other electronic banking facilities." Perhaps more disturbing from my perspective was the headline of a story from the ABC, Australia’s government broadcasting corporation, referencing a remark from an unnamed NAB spokesperson: "NAB system crash — ‘these things happen’."

They just happen — my ATM is out of action. Now what? Then it was the turn of another of the big four national banks — the Commonwealth Bank of Australia. In December 2011 they, too, took an outage and again it was a headline that caught my attention: "CommBank gremlins dock pay," said the Sydney Morning Herald. According to the Herald, "a serious ‘network connectivity’ issue meant that, for several hours, CBA customers could not withdraw money from ATMs, pay with EFTPOS or access online banking."

CBA CIO was reported to have said "a network switch issue caused some applications to lose connectivity," later confirmed by my sources as a mix of routers, switches and servers that are a part of Cisco’s interface to the network. According to Peter Shell, managing director of Sydney-based networking software specialists Infrasoft Pty. Ltd., "People were complaining of going without dinner because they couldn’t buy food!"

C’mon — this is Australia where many networking solutions were pioneered! Tucked away in the storyline was another reference of note, as the Herald added, "CBA said the issue experienced yesterday was ‘unrelated’ to another similar glitch that occurred on exactly the same day last year." Really? But then a matter of just a few weeks later, in early February of this year, it was the NAB that made it back into the newspapers again.

"NAB struggles with tech glitch," was how the Herald reported the story, this time adding this quotation: "'We can confirm that NAB experienced system problems last night which meant some customer were unable to successfully transact using NAB banking channels including ATMs EFTPOS, HiCAPS (a medical billing transaction system), Internet Banking and Telephone Banking,’ a NAB spokeswoman said Saturday morning."

The Australian, under the headline of "NAB computer crash cuts ATM, EFTPOS" said, "Today’s outage continues a sequence of major computer breakdowns at Australia’s major banks, a sequence that analysts claim will continue for some years as banks replace generations-old core systems."

Oh dear — blame the core systems, naturally! Really? Payments platforms are generally what you will find running most of the world’s ATM networks, and yet the media is quick to point fingers at the old, mostly batch legacy core banking systems. True, there are some cracks developing, but then, returning to the story in the Herald just this month, "NAB, like most of Australia’s major banks, is undergoing a multi-year program to update its aging computer infrastructure." A little deeper into the story, the paper suggested, "Bank processing upgrades, as well as back-office confusion blamed on outsourcing contracts, have made Australia’s banks prone to a series of high-profile technical outages in recent years."

Crashes! Glitches! Breakdowns! Legacy applications, aging infrastructure, back-office confusion and yes, the outsourcing of contracts! You just have to feel for all those Australians who routinely depend on ATM access to travel by train, shop and simply eat. And it’s not just the poor little Aussie battler, but small business as well. "We can’t pay any of our suppliers and process orders. It’s really devastating for a growing business like ours," lamented one small business retailer, CaseOn, which sold online phone and tablet cases to the Herald.  

I have spent a lifetime in IT, where I have spent equal time working first with IBM mainframes and then with Tandem Computers (later renamed NonStop Systems and now a part of HP). In that time I have also worked with Nixdorf ATMs and with ACI Worldwide solutions. I have even spent time with middleware providers such as GoldenGate Software, now a part of Oracle. But nowhere have I seen such disruptions arriving on such a regular basis as they are in Australia and I just have to put it down to extremely poor execution.

Yes Wally, I just have to ask — who’s on first base? Mixing my American and Australian metaphors, but my point is, where’s the planning? And if it truly is all due to older systems — clearly poorly informed journalists writing about the presence of mainframes and perhaps even NonStop, and totally unaware just how modern these systems have become — then who is overseeing operations?

Would it be any better if it all ran on Windows and Dell, for instance? The answer of course is no, just ask the other of Australian "big four" bank, ANZ, who somewhat embarrassingly had to back away from such a project down when they ran into serious difficulties having to do with scaling up. 

ATMs work just fine. Computer systems are robust and networks are reliable — but as for the current crop of Australian banking CIOs, you just have to wonder. I am starting to make plans for a trip to Sydney and all I can think about is just how much cash I need to take with me — after all, the Aussie network does seem to be a bit fragile, and as any business traveler can attest, no one likes being left looking stupid in front of an ATM that doesn’t deliver!

About Richard Buckle

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Richard Buckle is the founder and CEO of Pyalla Technologies, LLC. He has enjoyed a long association with the Information Technology (IT) industry as a user, vendor, and more recently, as an industry commentator, thought leader, columnist and blogger. Richard participates in the HPE VIP Community where he is part of their influencer team.

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