Will Smart Cards Ever Become Popular In America?

In recent years, smart cards have been touted in high-tech books and magazines as the wave of the future. We've all read about how popular this technology is in Europe, the Far East and South America. Yet despite all the hype, including a much-touted beta test in New York last year, smart cards still have not taken off in the United States. However, this is slowly changing, say two representatives of smart card printer vendors.

Holly Sacks is vice president, marketing for Eltron International, Inc., a manufacturer of card and bar-code printing systems and related products. Eltron is headquartered in Simi Valley, CA, has 550 employees and had gross sales of $105 million for FY 1997.

Mark Iverson is director of marketing communications for DataCard Corporation, a manufacturer of cards and card printers. DataCard has 2,100 employees worldwide and 1997 gross sales of $350 million.

Smart Card Manufacturers Offer New Features…
Sacks cites improvements in the production of smart card printers in the U.S. The image quality and speed of printers have increased dramatically. Printers can now routinely print cards with 300 dpi resolution, edge-to-edge, and in full color. They can produce 1,000 cards per hour in black and white and 180 per hour in full color - from Windows-driven PCs.

They can print on both sides of a card and can print holographic images. They can perform personalization and are more reliable. (Eltron now issues 100,000-pass warranties with its printers.)

…But Flexibility Is The Most Important.
Perhaps the most important trend in smart card printing, however, is flexibility. Both Sacks and Iverson stressed the importance of being able to provide multiple applications and features. Smart cards can be used for financial transactions, for positive identification, for fraud prevention. They can be contact-based or operate in contactless, "walk-by" mode. They can have stored-value applications, such as gift certificates or phone cards. Or they can have data collection applications, such as frequent buyer programs or trade show access. In sum, smart cards are capable of a wide variety of applications which no other single medium can accomplish. According to Iverson, the British government recently mandated all new credit cards must be printed with chips. Designed to eliminate fraud and counterfeiting, the law takes effect in 1999.

How VARs Should Be Taking Advantage Of These Trends.
Eltron's Sacks believes VARs who deal with retailers are probably in the best position to push smart card use, for applications such as frequent buyer programs. Iverson, on the other hand, believes VARS who specialize in data collection are probably better suited. Both, however, strongly believe that interested VARs need to team up with well-known smart card software developers. Once the VARs learn what smart cards can do for their customers, the VARs will be well-suited to advise them. Both also suggested, however, that while selling smart card solutions will be lucrative, these systems are not ‘plug and play'. Therefore, VARs will need to work closely with vendors to learn the systems. Again, Iverson and Sacks stressed the importance of dealing only with well-established vendors - preferably those who set industry standards.