Immortal Technology

Blog Post created by zkurka on Aug 19, 2016

I have stated on several occasions to think about upgrade cycles on your POI (point of interaction) hardware at 2-3 years.  One of my coworkers absorbed these statements in the literal sense that 2 years is all they will last in contrast to the common wish that your pin pads are the Highlander, and while only rarely has a  VeriFone 1000SE led to decapitation, is more or less expected to live forever.  


The concept of the 2 year replacement cycle is in the light side, I try to say 2-3 because this timeline is often correlated with a PCI expiration.  EMV and NFC were market disruptors in 2015 causing an atypical replacement cycle that fell perfectly between the PCI expirations of 1.x in 2013 and 2.x next April, 2017.  2-3 years could be thought of as the literal average life cycle for hardware in some cases, similar to the lifespan in years of a car driven 30k a year being less than a car driven 5k.  To quote a famous college professor, “it’s not the years, it’s the mileage.”


Though that concept of wear and tear leading to shorter lifespans of product is true over a wider array of devices outside of payments, oddly the hardware trusted to enable the most fundamental part of commerce, the exchange of goods for currency, is viewed with contempt and as a necessary evil.  As such it’s uncommon for users or installers to make a concerted attempt to understand POIs.  It’s often just expected to work, and when it does not the responsibility is often pushed to someone else.


I often describe the concept of the 2-3 year life cycle as “just like your cell phone”.  My attempt isn’t to suggest that after 2 years you have to worry about your POI hardware overheating, butt dialing, and leaking purple smoke (though I have to admit that would be a cool indicator of end of life).  The attempt here is to shift the paradigm by creating a correlation to the one piece of hardware that most folks can’t live without.  Missing a cell phone has been shown to cause extreme anxiety and in some cases violent responses.  While I don’t see anyone going fetal or getting in a fistfight over a Verifone anytime soon hopefully there is some middle ground.  I muse at a world where POI hardware is purposely retired in favor of newer, more feature rich, and secure tech just as is embraced with the cell phone.  If viewed in this way, natural life cycles would be embraced.  Unfortunately we might be quite a ways away from this relationship with our POS.  A good exemplification of this is the Vx805 shortage in Q4 2015.  The reaction was externalization of the responsibility for the shortage.  I don’t think I heard a single “I” statement in the explanations for 3 months.  If this was a shortage of iPhone7s at the month of the release I suspect the statement would be, “shoot, I should have preordered my iPhone7.”  The tough part about this argument is that it is entirely emotional in that the smartphone is perceived as a desired evil rather than a necessary one.  If you lean towards being one of those adherents enjoy your sinful Apple bliss and please read the next, more mathematical approach.


In 2007 my old 20” TV started on the downward spiral.  I was in the middle of my 3rd stint in college and measuring money tightly enough that I knew the cost per egg in the 18ct carton.  It was about 12 cents.  When I added the English muffin, generic American cheese, cooking spray, and a dash of Tapatio, my breakfast sandwich in the morning was just shy of 50 cents (Take that McDonalds!).  My roommate at the time was 1 year out of school and reaping the benefits of having a real life adult job had purchased a 39” Sony 3 months prior.  Now I am not suggesting anyone will ever go out and buy an iSC480 to top your L5200, but I had a real bad case of technology envy.  I looked at a lot of TVs over the next week, but the one I kept coming back to was the gorgeous utopic depictions on the Sharp Aquous.  To add to the already consternating decision it was also on sale….for 900.00!  What is a poor college student to do, but rationalize.  In this case the approach to a 900.00 TV was the same as the Egg McMuffin.  Without boring you with math I figured out my average usage if I expected a 4 year lifespan.  It basically came down to costing me 40 cents a day based on the amount of TV I was watching at the time.  Basically a new TV per diem was cheaper than a breakfast sandwich.  Based on that line of thought what does a set of new pin pads for each lane cost when broken down over the hours of operation and days open per year over 2-3 years.  My guess is that if you get a Starbucks drink each morning at 3.50, your barista could be exchanged for a couple Ingenico touch screens.


I wouldn’t be on a soap box professing that we need to change the way we think about our hardware as a worthy investment either by emotional perception or financial rationalization if I wasn’t seeing a slightly dangerous trend in the industry combined with the current doctrine of thought.  At risk of one last analogy, think about the evolution of the automobile over the last 30 years.  In 1980 there used to be minimal electronics and several dozen moving parts.  If something did break the repair was either done with a hammer or a bigger hammer.  Conversely cars today all have computers and of something breaks the clunks, creaks, or splinters of metal are no longer the indicator for the mechanic, replaced by computer diagnostics.  Remote diagnostic services even have the ability to shut your car off it they sense danger.  Our POS hardware is on the same technological tangent.  Chip readers, integrated scanners and contactless modules add to the complexity of the design and opportunities for failure.  PCI security requirements that mandate features to protect data, but can potentially render the pad inoperable necessitate a different thought approach.  We need to perceive the POI hardware as a tool worthy of the investment on a regular cadence rather than an unwanted and unsavory expenditure.


Maybe I am a unique technology user.  My phones are new every 2-3 years.  I never expect a longer life out of them and always strategize the purchase of a new one before the demise of the old.  This means I get exactly the life out of the phone that I expect to.  The Sharp is still alive.  I am going to undoubtedly watch some Netflix in high def this evening.  If I got home and the Sharp was dead, I would memorialize it with a cheap breakfast sandwich and start doing the math to justify my next TV.  After all, it doesn’t owe me 4 dimes in fact I have to cost per day down to 5.4 cents.  As I expected to pay 40 cents a day, I am far into the win column on that purchase.


I challenge each of you reading this to figure out the cost of the POI Hardware over 3 years.  Also how much does your breakfast cost?