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One of the nice things about being chief marketing
officer is that you get to make up words
with impunity. Jeff Hale, for example, is partial
to “connectibility.”
Hale’s literary license is well justified. As CMO of
ACI Worldwide—a leader in electronic payments
processing software, with over 500 customers in
75 countries—he knows that the ability to link
disparate products and solutions is key to today’s
Adaptive Enterprise. And this is precisely what
ACI’s BASE24 software on the HP NonStop platform
makes possible for major banks, retailers,
and e-payments processors around the world.
“Many of the technologies in the marketplace
today were designed for fairly homogeneous environments,”
Hale explained. “But in fact, you rarely
see that kind of environment in large banks; they
tend to buy best-of-breed solutions, essentially
becoming the end integrator by putting the solutions
together with all their other systems. The
combination of HP NonStop technology and our
BASE24 product is unique in its ability to support a
wide range of communications protocols, as well
as a wide range of interfaces into legacy systems
and payment networks around the world. This
makes it much easier for our customers to change
their business models and relationships quickly in
response to shifting market dynamics.”
Another way in which ACI application software
and the HP NonStop platform help increase enterprise
agility is their inherent “start small and grow”
capability. “The underpinnings of our joint technology
were designed to allow customers to scale in the
way that is most cost-effective for them,” said Hale.
“This allows a bank to deploy a small debit card
program, for example; as customers gravitate to
debit cards and the transaction volume increases,
the bank can add NonStop servers and ACI software
capabilities in a linear fashion along that curve.
We’ve enabled our customers to grow along with the
electronic payments market for the last 25 years.” |
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Moving in on Big Blue
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The powerful BASE24 solution represents a viable
challenge to existing mainframe environments,
according to Jeff Hale, chief marketing officer at ACI
Worldwide. “ACI has been replacing IBM systems since
our inception as a company, but sheer replacement is
less common today,” he stated. “More often, we find
that clients use BASE24 to create enhanced services
that they are unable to develop quickly and cost-effectively
in the legacy mainframe world.”
“Brick” is a term Hale often uses when referring to a
legacy application running on a mainframe system.
“The good news is, you have a brick,” he said. “The bad
news is, the brick is where critical information like
account balance resides. You have to go to the brick
for information, but if you want to add value to that
transaction, you do it on the NonStop server with
BASE24. The mainframe doesn’t have the required
knowledge base of real-time customer, product,
and transactional information, and it’s also really
hard to change. We hear this over and over from
our customers.”
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The numbers say it all: BASE24 on the NonStop
server supports over 13,000 Bank of America ATMs.
At Royal Bank of Scotland, the solution handles
over 10 million transactions per day; at Barclays
Merchant services, it supports over 800,000 points
of sale. Capital One uses BASE24 to authorize transactions
for more than 46 million accounts. ACI’s
BASE24 customers processed over 40 billion
e-payment transactions in 2003, for a cool $3 trillion. |
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Major trends
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| Today, Hale sees three major trends in the electronic
payments market that leverage the value
proposition of ACI software on the NonStop platform.
The first is overall transaction growth. “The
increase in electronic transactions around the world
is approximately 15 percent per year,” he noted.
“This is led by a phenomenal rise in the use of
debit cards, which are replacing check, cash, and
even lower-end credit card transactions. Debit card
usage is growing at 15 to 25 percent a year in the
United States, and even faster in some other parts
of the world.” The linear scalability of BASE24 on
the NonStop server continues to make the solution
extremely relevant in this marketplace.
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Broadening the relationship
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| BASE24, which runs exclusively on the NonStop
platform, accounts for 75 percent of ACI’s revenue
and continues to be the company’s flagship product.
Recently, however, ACI released BASE24-es, a
new product based on C++ and Java™ technology.
The product was designed from the outset to
run in multiple environments, including the
HP-UX and NonStop operating systems.
BASE24-es is the foundation for ACI’s new
Enhanced Authorization solution, a powerful scripting
engine that lets users define the way in which
transactions are authorized, and this new solution is
attracting plenty of interest in the banking community.
“We currently have eight clients in the
Americas and Europe that are implementing the
Enhanced Authorization solution,” stated Hale.
“They are putting it on the same NonStop servers
that are running the ‘classic’ BASE24 software, and
they’re doing a wide range of different things with
it. Some are using the product for basic transaction
authorization; some are using it to detect and
manage fraud more effectively; some are using it to
help manage smart card deployment. It’s interesting
to watch clients come up with unique and innovative
ways to use the software.”
Several ACI clients are also in the early stages of
investigating HP’s Real Time Financial Services
(RTFS) solution, which delivers a unified, up-to-the-second
view of critical customer and business
information across the enterprise. “We see growing
interest in the renewal of ATM and branch systems
in many parts of the world, and the convergence of
these systems naturally lends itself to a hub-based
architecture like RTFS,” noted Hale.
HP and ACI are working to broaden their
relationship in other areas, as well. ACI has close
ties to HP Global Services, and the company
also has several successful products—including
Proactive Risk Manager and WINPAY—that are
frequently deployed on HP ProLiant servers.
But the core relationship still revolves around the
NonStop platform. “The pure OLTP market that we
serve continues to grow,” concluded Hale. “This
puts stress on systems, and it creates unique
requirements for technologies like the ones ACI and
HP have delivered to the market for years. When it
comes to electronic payments, ACI software
products on the NonStop platform are still the best
business solutions leveraging the best underlying
technology platform—and our growing customer
base proves it.”
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The right way to partner
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| ACI Worldwide was part of a major win that HP
announced for Toronto-Dominion Bank (TD Bank), one
of Canada’s largest financial institutions. The company
will provide BASE24 transaction management software,
plus application development and maintenance
services, as part of the overall solution. ACI’s chief
marketing officer, Jeff Hale, was impressed with the
collaborative partnership model employed by HP
throughout the sales cycle.
“HP involved all the team members in every meeting
with the client and in virtually every decision-making
process,” he said. “The attitude was, ‘We’re HP and
we’re the prime contractor, but we’re not the experts
in every part of this solution. We’re going to bring the
experts in, so the client can get the best overall representation
of the solution.’ HP was very open about
bringing the partners—including ACI, Diebold, and
Phoenix Interactive—to the table so they could answer
the customer’s questions directly.”
Under the terms of the multimillion-dollar outsourcing
contract, HP Canada will manage TD Bank’s network
of banking machines and debit card payment systems.
The contract also calls for upgrading the bank’s point-of-sale processing systems and 2,400 automated
banking machines across Canada.
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