INFINEON 3Q/02

Infineon Technologies reported third quarter revenues of Euro 5.21
billion, a decrease of 8% from the previous fiscal year. The revenue
decrease resulted from the overall sluggish semiconductor market with
substantial pricing pressure in all business groups, especially memory
products. Annual EBIT (earnings before interest and taxes) was a loss of
Euro 1.14 billion, compared to a loss of Euro 1.02 billion in the previous
year mainly due to the ongoing price pressure in the industry and to
decreased demand in the communications and chip card ICs segments,
especially during the first half of the year. Revenues of the Security &
Chip Card ICs group were Euro 129 million, an increase of 8% from the
previous quarter. The continuing improvement of this segment has been
mainly driven by improved sales of security controllers used in mobile
communications, payment and identification applications. In 2001, Infineon
was the worldwide market leader in smart cards for the fourth consecutive
year and has improved its revenue market share to 39% according to Dataquest.

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Compete Study

Boston-based Compete Inc. says a new study shows that Capital One’s strategy of offering a “No-Hassle” card at an APR of 4 to 5 percentage points below competitors’ rates attracted applicants away from MBNA and Citibank. Compete says both MBNA and Citibank rely primarily on affinity and reward programs to attract new cardholders. The new Compete data showed that Capital One dominated competitors in attracting new credit card applicants, averaging over seven times the applicant volume of Citibank and MBNA. On average, 22% of MBNA’s applicants also considered Capital One, and one-third applied for a Capital One card. Similarly, 17% of Citibank’s applicants also considered Capital One, and one-fourth applied for a Capital One card. An average of 15% of MBNA’s and 24% of Citibank’s credit application abandoners (consumers who started but did not submit an application) evaluated Capital One, and one-eighth of abandoners from both companies ultimately applied for a Capital One card. Compete believes that the credit quality of applicants at Capital One was similar to those at Citibank and MBNA, since the demographic profiles of the defectors to Capital One from Citibank and MBNA were similar to the overall applicant pools for all three companies. In addition, the applicants’ behavioral profiles and use of other financial service products, such as brokerage and banking accounts, did not differ among the issuers.

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NCIPHER 3Q/02

nCipher plc reported that revenues were flat at £2.8m compared to Q2/02.
However, the operating loss was reduced from £2.4m to £1.7m because the
company maintained strong gross margins (79%) and reduced our operating
overheads. After interest the company reported a net loss of £0.7m and
consumed less than £0.1m of cash. nCipher provides hardware and software
solutions that enable organizations to implement best practice security by
addressing the challenges of cryptographic key management and performance.

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Cubic Houston

Cubic Transportation Systems has received an $8 million contract to provide Houston METRO with a smart card-based fare collection system for the city’s public buses. Cubic will upgrade Houston METRO’s fareboxes with smart card processors and provide “Point of Sale” devices throughout the transit system to allow customers to purchase and reload their fare cards. The system’s support network will be based on Cubic’s Nextfare platform, an open, non-proprietary architecture that conforms to industry standards. In addition to the Houston initiative, Cubic over the past 10 months has received contracts to provide smart card-enabled ticketing technology to transit providers in Baltimore, Los Angeles, Minneapolis, New York and San Diego.

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TRM 3Q/02

OR-based TRM Corporation reported net income of $182,000 for the third quarter compared to a net loss of $1.09 million for the same period in the prior year. Revenue for the third quarter grew to $21.7 million, an increase of $1.9 million from third quarter 2001. TRM says the increase is attributable to substantial growth across the Company’s ATM network that produced revenue of $7.5 million, up $2.2 million (or 41.9%) from the same period a year prior. TRM continues to experience multinational expansion in its ATM operation and remains among the largest independent ATM networks in the USA. For complete details on TRM’s 3Q/02 performance visit CardData ([www.carddata.com][1]).

[1]: http://www.carddata.com

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Vital & TNS

Vital Processing Services is recognized leader in technology-based commerce enabling services, announces the addition of a new data communications service provider to its existing communications network. The Company has signed a multi-year agreement with Transaction Network Services, Inc. (TNS) to deliver POS transaction network services. TNS is one of the leading providers of fast, reliable data communications services for transaction-oriented applications.

“The provision of secure data communications connectivity is mission-critical to the transaction processing business,” said Jonathan Palmer, president and CEO of Vital. “This agreement provides Vital s acquirers and merchants with an alternative communications partner.”

“At Vital, fault-tolerance and redundancy are built into every aspect of our processing services,” Palmer continued. “In a strategic review earlier this year we identified service provider diversity as another step we could take towards assuring no single point of failure throughout our operation.”

Brian Bates, TNS President and Chief Operating Officer commented, “As a leading network transport provider to the POS industry, TNS is very pleased to have this opportunity to support Vital s business with both current and future network access technologies. We look forward to delivering a transaction transport solution that meets the rigorous requirements of Vital and its customers.”

“TNS was selected after a thorough review and extensive selection process,” said Robert Blair, executive vice president and chief information officer at Vital. “TNS stood out based on their experience and leadership in POS networking and their systemic focus on quality.”

The new relationship with TNS will allow Vital s merchants to continue to have access to local, toll-free 950 services, one of the most efficient merchant networking alternatives. Vital and its customers will also benefit from additional connectivity options offered by TNS through its secure, nationwide transaction transport network.

About Transaction Network Services

Transaction Network Services is one of the leading providers of fast, cost-effective data communications services for transaction-oriented applications. Transaction Network Services provides reliable and secure transaction delivery platforms to enable transaction authorization and processing across several vertical markets and trading communities. Since its inception in 1990, Transaction Network Services has designed and implemented one of the fastest, most reliable and lowest cost networks for the transport of transaction-oriented data.

Transaction Network Services proprietary network technologies have been deployed in the United States and internationally, and Transaction Network Services network has become a preferred network servicing the card processing and dial-up automatic teller machine markets.

For further information about Transaction Network Services transaction solutions, please refer to [www.tnsi.com][1].

About Vital Processing Services

A leader in technology-based commerce enabling services, Vital Processing Services® (Vital®) is the commerce connection between acquirers and merchants, processing one out of every four authorized payment transactions in North America. From authorizing and capturing electronic payments at the merchant point of sale, to clearing and settling transactions, Vital provides highly reliable, integrated end-to-end processing services to more than 300 acquirers and over one million merchants. Vital processes all payment types for merchants of all sizes from a wide array of industries and provides merchants and acquirers with the information and tools to efficiently manage their payment processing businesses. Vital is a merchant processing joint venture of Visa U.S.A. and TSYS® (“NYSE: TSS”). Additional information regarding Vital can be found at [www.vitalps.com][2].

[1]: http://www.tnsi.com/
[2]: http://www.vitalps.com

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VISA Olympics

VISA International has inked a deal to renew its Olympic sponsorship through the 2012 Olympic Games. VISA will continue to be the exclusive payment card and official payment service for the four Olympic Games following “ATHENS 2004.” This will include the “XX Olympic Winter Games” in Torino in 2006, the “Games of the XXIX Olympiad” in Beijing in 2008, and the 2010 and 2012 Olympic Games, whose sites have yet to be selected. VISA’s renewed sponsorship extends to all participating National Olympic Committees and their Olympic teams. Rights include advertising and promotional use of Olympic marks and graphics, as well as marks from the National and International Olympic Committees. The agreement also gives VISA the exclusive global marketing rights and official status for the Paralympic Games through 2012. VISA began its Olympic partnership in 1986.

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NCR Update

NCR says its ATMs dispense $2 million dollars in cash every minute of every day in over 100 different currencies. NCR’s next generation “M Series” Personas(TM) ATMs customize the ATM experience based on each bank’s needs. The next big move is to make depositing at the ATM as simple and trusted as withdrawing cash. To do this, NCR’s new ATMs can offer no-envelope deposit.

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Sprint Emerges

The demise of MCI/Worldcom deals with credit card issuers and loyalty programs has given away to a new suitor, namely Sprint. Sprint announced this week a marketing partnership to provide United “Mileage Plus” members, including holders of the Bank One “Mileage Plus VISA,” an opportunity to earn up to 6,000 bonus miles for choosing Sprint for residential long-distance service. The switch from MCI to Sprint for United is effective immediately. Sprint will offer United “Mileage Plus” members the opportunity to earn 5,000 “Mileage Plus” bonus miles. These miles will be awarded over the course of six months when members sign up for one of the select “Sprint 7 Cents” long-distance products. In addition, if customers choose to sign up online they will receive an additional 1,000 miles. Once choosing Sprint in the Mileage Plus program, customers will earn five miles for every dollar spent with Sprint for their residential long-distance services.

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HBOS APTRA

HBOS, the financial services group formed by the merger of the Halifax and
the Bank of Scotland, have inked a deal to deploy NCR’s “APTRA Edge”
software across its entire ATM network made up of 3,400 NCR ATMs and 400
Fujitsu ATMs. The deal includes 14,000 “UP-to-SPEED” upgrade kits to
support the move to “APTRA Edge,” while allowing HBOS to meet new
accessibility, smart card and encryption standards in banking. Plans to
roll out the software to all of HBOS’ ATMs follow the successful
installation of “APTRA Edge” on 300 NCR ATMs last year and earlier this
year. “APTRA Edge” will enable HBOS to integrate its complete ATM network
with other service channels, opening up the possibility to provide
cross-channel consistency in customer service, branding and communication
to all HBOS customers. The vendor-independent software will be installed on
all ATMs by the end of 2003. HBOS has over 25 million customers.

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VISA-IN-TOUCH

VISA International Asia Pacific has deployed the Pivotal CRM suite as
part of its “VISA in Touch” initiative. Using Pivotal CRM, VISA is able to
simplify its business processes, improve account management, share
information across VISA offices and track each customer’s unique needs,
product usage and history. VISA has customers across more than 40 countries
in the Asia Pacific region, each customer account is complex, and many have
numerous contact points, geographies and time zones. Pivotal, based in
Vancouver, offers a complete CRM software suite including capabilities in
marketing, sales, service, contact centers, partner management and
interactive selling. More than 1,500 companies around the world use Pivotal
including: CIBC, Centex Homes, HarperCollins Publishers, Hitachi Telecom
Inc., Premera Blue
Cross, Royal Bank of Canada, Southern Company, and Vivendi.

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