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The Green Sheet Online Edition

January 21, 2009 • Issue 09:01:02

New Products

Future proof that POS

Product: Product: Vx510 Ethernet terminal
Company: Company: VeriFone

According to telecommunication software manufacturer GAO Research Inc., of the 10 million POS terminals in service in the United States today, over 60 percent use dial-up modems to connect card swipers with payment networks. Why?

Because dial technology is reliable and the devices that utilize it are low-cost for merchants to implement and maintain.

But the big downside to dial-up terminals is they are slow. GAO Research said transaction times using dial-up range from eight to 12 seconds. Scott Henry, Director, North American Product Marketing at VeriFone, put that time in the 15 to 20 second range.

In contrast, Henry pointed to Internet protocol- (IP) based terminals - such as those that are Wi-Fi- or Ethernet-enabled - where the transaction times are only three to four seconds. But many level 3 and 4 merchants with dial-up terminals are hesitant to upgrade because of the expense and unfamiliarity with newer technologies.

VeriFone's Vx510 Ethernet terminal might be the device, however, that bridges that gap.

Building upon its standard Vx510 dial-only swiper, VeriFone added Ethernet capability. The dual-functioning terminal allows merchants to stick with standard dial-up, but gives them the option of switching to the much faster Ethernet connection at any time.

Faster throughput

Unlike dial-up modems that transfer a limited amount of data over ordinary phone lines, Ethernet functions with high-speed, broadband connectivity.

Ethernet, therefore, offers wide bandwidth for greater data flow capacity, which means swifter transactions at the POS.

But for merchants wedded to dial-up, the benefits of the terminal may need to be explained. Such merchants might experience slow POS transaction times because phone lines are being shared by electronic payment and phone systems.

Merchants might figure the solution to the problem is installing additional phone lines dedicated only to POS transactions.

But Henry said that solution is not ideal. Extra phone lines might cost merchants $40 to $50 more every month. The return on investment (ROI) of upgrading to broadband and the Vx510 Ethernet would result in faster throughput at checkout.

"If merchants have more than five or 10 transactions within an hour, you start seeing the queuing up at the checkout line," Henry said. "But certainly getting customers through in a more rapid fashion, that's going to lead to an ROI."

Security at a modest price

The other main benefit of VeriFone's Ethernet-capable terminal is in its security. Merchants using dial-up who want to upgrade to broadband might implement what Henry called "a poor man's Ethernet installation."

In this scenario, merchants take existing dial-up terminals, which might be one year old or 20 years old, and rig them to convert their analog signals into digital signals for transmission over faster IP networks. Such configurations not only cause lost transaction data, but also unsecure systems.

Such is not the case with Vx510 Ethernet, Henry added. The device gives merchants a secure, Payment Card Industry PIN Entry Device-approved terminal with triple DES encryption priced at the low end of the spectrum.

"Security is certainly paramount," Henry said. "But [the terminal] is going to give them that high transaction throughput at a price point that they are really looking for."

www.verifone.com end of article

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