Wells Fargo & Co. is selling advertising space on some of its automated teller machines, which have been equipped to display animation.

Two companies have bought ads: Amazon.com and a ski resort, which sells lift tickets through the ATMs.

The bank hopes to expand the program, which began last week on 340 ATMs in the San Francisco area. It is telling potential advertisers they can select machines in areas with favorable demographics for their products.

"We believe we are the first bank that has put together a comprehensive and integrated marketing program for advertisers," said Barry McCarthy, vice president of marketing and development for express banking at Wells Fargo.

Many banks have talked about selling ad space on their ATM screens, but few have gone beyond touting their own products on them.

One nonbank ATM owner, Electronic Data Services Corp. of Plano, Tex., has been running full-motion video ads on nearly 1,200 of its machines. The ATMs with ads are in 7-Eleven convenience stores and other locations.

The Wells Fargo ATMs do not support full-motion video, but can show cartoons and moving graphics, Mr. McCarthy said.

One ad-showing a cartoon skier and snowboarder schussing down a mountain-runs while the machine is idle or before a customer inserts a bank card. An ad for Amazon.com runs while a transaction is being processed, and a third ad-for various local nonprofits-is displayed at the end of the transaction.

"Our overall objective is to make the ATM easy and convenient for the customer," Mr. McCarthy said.

Mr. McCarthy joined the bank 10 months ago, after 12 years at Procter & Gamble, where he worked in packaging.

Banks have been deterred from selling ad space on ATMs because the hardware and software needed to handle sophisticated graphics were too expensive, experts said. But prices are coming down.

Wells Fargo upgraded its ATMs with Pentium processor chips and installed software from Novadigm Inc. of Mahwah, N.J., which enables the bank to download ads from a central location.

Wells Fargo said it will use demographic data-not customer information- to help media buyers select the ATMs they want to target. For example, Mr. McCarthy said, a car company might want to put on-screen ads for convertibles in downtown urban areas, and ads for minivans in the suburbs.

Wells Fargo is the nation's third-largest ATM owner, with 6,100 machines. It says it is the largest vendor of postage stamps at ATMs.

Last year, income from Wells Fargo's ATM network rose 30% over 1997, to $229 million, according to the bank's yearend earnings report.

"This is going to be a very good revenue-generator for them," said James E. McHale, president of McHale Group, an ATM consulting firm in Dana Point, Calif.

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