ATM&Debit News
Seven companies were manufacturing automated teller machines in the United States at the end of last year, down from nine a year earlier, and that number is expected to drop in 2007 in response to an ongoing price war in the market.
According to the 2008 edition of the EFT Data Book from ATM&Debit News, which is expected to be released Thursday, the top five ATM makers by shipments in this country in 2006 were: NCR Corp., of Dayton, Ohio; Diebold Inc., of North Canton, Ohio; Tranax Technologies Inc., of Newark, Calif.,; Triton Systems of Delaware Inc., a Long Beach, Miss., subsidiary of Dover Corp.; and the German company Wincor Nixdorf International GmbH.
The five companies delivered an estimated 66,967 ATMs to customers in 2006. (NCR's numbers include NCR EasyPoint, formerly Tidel Engineering LP, which it bought in 2006.)
The smallest manufacturers, all of which focused on off-premise ATMs, were NexTran Industries Inc., Greenlink Technologies Inc., and Fujitsu Transaction Solutions.
Fujitsu recently left the ATM manufacturing business. Greenlink is cutting back on manufacturing for now, and NexTran's role in the ATM market is unclear.
Combined, NexTran, Greenlink, and Fujitsu shipped 470 ATMs.
Fujitsu, of Frisco, Tex., sold its U.S. ATM operations in 2004 to Triton and Diebold, according to Fujitsu spokesman David Naumann. "Fujitsu sold its North American business in late 2004 because it didn't make sense. … It wasn't performing," Mr. Naumann said. "Some Fujitsu-made ATMs may have slipped through in 2005, but the company did not ship any in 2006."
It shipped 125 ATMs in 2005 and had manufactured ATMs in North America since 1983.
Lipman Electronic Engineering Ltd., another ATM manufacturer, stopped shipping machines in 2005.
Greenlink shipped 170 ATMs last year, down 80.2%. The Euless, Tex., company has changed its business model for the time being and is now focusing on helping other companies meet the Triple DES data encryption standards, though it continues to manufacture ATMs.
NexTran, of South Hackensack, N.J., shipped approximately 300 ATMs last year, down significantly from the from 3,270 machines it shipped in 2005, according to Eric Park, its chief operating officer.
Mr. Park would not discuss the sharp decline in volume, but said the company expects to make a major announcement in the near future. (His brother, Tony Park, is the company's president.)
Analysts and experts who follow ATM manufacturers say NexTran began having problems a year ago. Questions about card network violations at Innobeta Systems Inc., an ATM processor owned by the Park brothers, reportedly led to attrition. The problems there reportedly spread to Money Marketing Inc., an ATM independent sales organization that is also owned by the Parks.
Money Marketing, also of South Hackensack, once billed itself as the largest ISO on the East Coast, but its sales have fallen considerably. It had 1,000 ATM contracts during the first three months of this year, down from 3,870 in 2006 and 5,000 in 2003.
"We no longer have a wholesale business; it's a retail business. It's just what salesmen bring in," Mr. Park said. He added that Money Marketing has had to eliminate some jobs.
ATM manufacturers also face price pressure from companies that make ATMs for the off-premise market, according to Sam Ditzion, the chief executive of Tremont Capital Group, a Boston consulting firm.
A price war erupted when Nautilus Hyosung of South Korea entered the off-premise market in January, following a well-publicized split with its partner, Tranax. Nautilus cut prices to gain market share.
"The price cuts are 30% or more," Mr. Ditzion said. "The margins are slim to none. It's a reasonable possibility that we'll see one of the off-premise manufacturers shut its doors within the next year or two."
EFT Data Book compiles a variety of statistics and rankings for the ATM and EFT markets, drawn from interviews of company executives, analysts, and industry experts who follow the ATM marketplace.
