Smart Cards Grow While Bankers Dawdle

From the Smart Card Frontline...

Smart Cards Grow While Bankers Dawdle

While most banks wait on the sidelines, missing a growing source of fee and transaction-based revenue streams, leading retailers are creating new income streams using chip-based and other smart card applications, a new study says. Some retailers have found they don’t even need banks for some functions once on the banker’s private reserve.

The study by California market research firm Killen & Associates cites Rite Aid (formerly Payless/Thrifty), Kroger, Mobil Oil, Safeway, Peete’s Coffee, K Mart and Old Navy as examples of retailers now finding they don’t always need a bank to do banking. They have discovered, says Killen, that smart cards can boost customer loyalty, generate new sales, and reduce cash handling and other costs. Smart cards, which store information such as account balances, do not require telephone or dedicated data lines to verify transactions. Smart cards actually increase sales and customer traffic and retailers are catching on fast.

Said Michael Killen, the firm’s president, "The public is responding eagerly. Smart cards are increasingly finding uses in stand-alone, controlled applications."

Asked about study methodology, Killen spokesperson Jules Street said the study is part of a continuing smart card monitoring process by Killen and is not meant to be exhaustive or formally structured.

"It’s more of a continuing resource based on many, many calls to retailers, banks and others," he added. "But one thing it’s very important to realize is that retailers have a different spin on the keys to success than banks do. The banks are still looking at this almost as an extension of payments. If that’s how you look at them, the case in favor of the smart card switch doesn’t look as compelling. It makes sense that these banks aren’t moving very fast.

He added, "Think about how motivated you are to use a particular bank. How many credit card offers do you get in a week? How many do you bother to look at? The banks are notoriously bad at this."

Details of the market study are available in the report, "Retailers’ Smart Card Strategies: New Business Opportunities and the Disintermediation of Banks," the firm said. More information is available on the World Wide Web at http://killen.com.

(Contact: Jules Street, Killen & Associates,650-617-6130, E-mail jules@killen.com)

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Verbot Self-Animated Robots Poised For Smart Cards

Sylvie, Ka, and future siblings in Virtual Personalities’ new family of verbots will ultimately be able to recognize human faces, and to interact with both humans and their smart cards, said the inventor of the "intelligent" front ends, during L&H Technology Day.

Also in the works for these "self-animated robots" are fingerprint and voiceprint recognition, plus a new API (application programming interface) for adding verbot front ends to software applications, noted Peter Plantec, Virtual Personalities’ president and creative director, during a demo at a press event in Burlington, MA

Plantec predicted that verbots might soon be paired with smart cards to greet you, engage in casual chitchat, and check you in when you arrive at a hotel. Beyond the role of desk clerk, the verbot will be able to act as a concierge, dishing up custom tips about which local restaurants meet your personal tastes.

The same verbot will be able to ask if you need a map, for instance — and to print one out, if you do. The applications for verbots really do seem just about limitless.

Ray Kurzweil, chief technology officer for L&H, suggested to Plantec that Virtual Personalities’ verbots would make "great interfaces for games."

When used as a front end to an expert system, a verbot can be just as adept at helping people diagnose and solve problems as another human being according to Plantec.The personality and functionality of the verbot depends on the scripting, he added. Eventually, Sylvie, Ka, and other verbots will be able to converse casually with you through "natural language," and to know who you are through facial, fingerprint, or voice recognition.

Virtual Personalities, Inc. is located at http://www.vperson.com on the World Wide Web. More information about Lernout & Hauspie is available on the Web at http://www.lhs.com.

(Contacts: Virtual Personalities, Inc., 310-247-0660; Jim Williams, Lernout & Hauspie, 781-203-5103)

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