[ISN] ATMs Face Deadline to Upgrade From Windows XP

http://www.businessweek.com/articles/2014-01-16/atms-face-deadline-to-upgrade-from-windows-xp By Nick Summers Businessweek January 16, 2014 One-dollar bills. Envelope-free deposits. Stamp dispensers. These are a few of the features that Wells Fargo (WFC), Bank of America (BAC), JPMorgan Chase (JPM), and other banks tout as the latest and greatest features of their fleets of ATMs. It’s hardly stuff to set the heart racing. When ATMs were introduced more than 40 years ago, they were considered advanced technology. Today, not so much. There are 420,000 ATMs in the U.S., and on April 8, a deadline looms for nearly all of them that underscores how sluggishly the nation’s cash delivery system moves forward. That’s the day Microsoft (MSFT) cuts off tech support for Windows XP, meaning that ATMs running the software will no longer receive regular security patches and won’t be in compliance with industry standards. Most machines that get upgraded will shift to Windows 7, an operating system that became available in October 2009. (Some companies get a bit of a reprieve: For ATMs using a stripped-down version of XP known as Windows XP Embedded, which is less susceptible to viruses, Microsoft support lasts until early 2016.) Inside every ATM casing is a computer, and like all such devices, each one runs on an OS. Microsoft’s 12-year-old Windows XP dominates the ATM market, powering more than 95 percent of the world’s machines and a similar percentage in the U.S., according to Robert Johnston, a marketing director at NCR (NCR), the largest ATM supplier in the U.S. The many offshoots of the country’s jumbled ATM network, ranging from convenience stores that operate a single antiquated cash machine to national banks that oversee tens of thousands of terminals, are feeling the deadline in different ways, says Suzanne Cluckey, the editor of ATM Marketplace, a news site that serves the industry. More advanced ATM fleets can do the update over their networks. Older ATMs must be upgraded one by one or even replaced entirely if they don’t have enough computing power to run the newer, more demanding software. “My bank operates an ATM that looks like it must be 20 years old, and there’s no way that it can support Windows 7,” says Cluckey. “A lot of ATMs will have to either have their components upgraded or be discarded altogether and sold into the aftermarket—or just junked.” Aravinda Korala, chief executive officer of ATM software provider KAL, says he expects only 15 percent of bank ATMs in the U.S. to be on Windows 7 by the April deadline. “The ATM world is not really ready, and that’s not unusual,” he says. “ATMs move more slowly than PCs.” While ATMs seem to be everywhere, their total number—an estimated 3 million worldwide, according to consulting firm Retail Banking Research—isn’t very many compared with the global base of Windows users. As a rule, security patches that directly affect the machines might be issued only once a quarter, Korala says. […]




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