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The POS battle is not over

Week 43, 2010

These last two episodes are the continuation of a restructuring process that has already been ongoing for a few years. Major POS vendors are engaged in a race to critical size, and struggle for the leadership position by acquiring tier II vendors. The payment terminal industry has already experienced the acquisition of Moneyline and Sagem Monetel by Ingenico, the acquisition of Lipman by VeriFone and the acquisition of Thales eTransactions by Hypercom. These acquisitions allowed the Tier I POS terminal vendors to reach a global footprint, and to secure their market shares. Also, the three Tier I vendors have strong R&D and industrial means, and have the means to develop a global strategic vision.

However, Tier I players are threatened on their core business by newcomers from emerging countries. For instance, PAX Technology, Shanghai Sand, Fujian Newland or Castles Technology have increased their expertise level both in terms of technology and of market understanding, and are positioned to take advantage of their Chinese manufacturing base to conquer the world with their lower price POS terminals. Details about these companies are available in our recently published Smart Insights Report “Greater China POS terminal offer 2010”

At the same time, these Tier I players are diversifying in order to cover more space in the global payment and consumer services environment. Ingenico has set up an active diversification strategy through a series of acquisitions, or major investments: easycash, TransferTo, Korvac, IRN Payment Systems, Payzone, …

In the near future, we may well see a market structured between major companies positioned on a global payment-related offer, and hardware focused industrialists from Greater China.

Thierry Spanjaard

Chief Editor

Smart Insights