Banks to be hit with Microsoft costs for running outdated ATMs

[humble3d]

Banks to be hit with Microsoft costs for running outdated ATMs

* Microsoft withdraws support for Windows XP on April 8

* U.S., UK major banks negotiate fees for extended support

* 95 percent of world's 2.2 million ATMs run on outdated XP

* One-third of ATMs have been upgraded to Windows 7

* Cost of upgrade for each UK bank around $100 million - sources

By Matt Scuffham and David Henry

LONDON/NEW YORK, March 14 (Reuters) - Banks around the world, consumed with meeting more stringent capital regulations, will miss a deadline to upgrade outdated software for automated teller machines (ATMs) and face additional costs to Microsoft to keep them secure.

The U.S. software company first warned that it was planning to end support for Windows XP in 2007, but only one-third of the world's 2.2 million ATMs which use the system will have been upgraded to a new platform, such as Windows 7 by the April deadline, according to NCR, one of the biggest ATM makers.

To ensure the machines are protected against viruses and hackers many banks have agreed deals with Microsoft to continue supporting their ATMs until they are upgraded, extra costs and negotiations that were avoidable but are now likely to be a distraction for bank executives.

"There are certainly large enterprise customers who haven't finished their migrations yet and are purchasing custom support," a spokesman for Microsoft said, declining to name those customers or to quantify the extra revenue it is earning.

"The cost will depend on both the specific needs of the customer and what support they already have in place, so it's different for every customer."

Britain's five biggest banks - Lloyds Banking Group , Royal Bank of Scotland, HSBC, Barclays and Santander UK - either have, or are in the process of negotiating, extended support contracts with Microsoft.

The cost of extending support and upgrading to a new platform for each of Britain's main banks would be in the region of 50 to 60 million pounds ($100 million), according to Sridhar Athreya, London-based head of financial services advisory at technology firm SunGard Consulting, an estimate corroborated by a source at one of the banks.

Athreya said banks have left it late to upgrade systems after being overwhelmed by new regulatory demands in the wake of the 2007-08 financial crisis.

"They were probably not very serious about the directive that came in from Microsoft. There's a lot of change going on at these banks at this moment in time and they would have seen Windows XP as one more change," he said.

Windows XP currently supports around 95 percent of the world's ATMs.

About 440,000 - or one-fifth of the world's ATMs - are located in the United States and many of the banks operating them will still be running their ATMs with Windows XP for a while after the April 8 deadline, said Doug Johnson, vice president for risk management policy at the American Bankers Association.

"One thing in our favour is that XP is battle-hardened," Johnson said. "People will benefit from years of fine-tuning of XP...It has been through wars."

STAND IN LINE

The queue of banks waiting to upgrade means there aren't enough people to do the work.

"There is a little bit of a bottle-neck," said Johnson.

Some banks are using the upgrade as an opportunity to introduce new features to their ATMs such as being able to read cards that have microchips rather than magnetic stripes.

Banks in the United States, where the old-fashioned swipe and sign magnetic stripe credit cards are still in use, have to upgrade their ATMs to read chip cards.

JPMorgan, which has 19,200 ATMs, will start converting its machines to Windows 7 in July, with a goal of finishing by the end of the year. With the change, JPMorgan expects to improve data encryption and ensure machines take software upgrades more efficiently and be offline for less time.

A spokeswoman for the bank declined to say how much JPMorgan is paying Microsoft for the extended XP coverage.

Bank of America also said it would ask Microsoft to extend support for its machines still running on Windows XP.

Citigroup Inc, which has more than 12,000 ATMs worldwide, said it is in the process of upgrading its machines from XP and declined to give further details.

In Britain, RBS, which has been hit by a succession of IT problems, has agreed a fee with Microsoft in return for it continuing to support its 9,000 ATMs for up to three years, a source familiar with the arrangement told Reuters.

RBS will begin upgrading its ATMs to run on Windows 7 next year and expects to complete the process within three years, the source said. The investment is part of the 1.4 billion pounds each year which new Chief Executive Ross McEwan has committed in order to improve the bank's computer systems.

McEwan admitted in December that RBS had neglected its technology for decades.

Lloyds said it had agreed to pay Microsoft an undisclosed amount to extend support until 2016 while it upgrades its 7,000 ATMs. The bank will start upgrading its ATMs later this year.

HSBC, which has 3,200 ATMs, said it was two years into a three-year programme of upgrades which it expects to complete next year. It had also reached a deal with Microsoft.

Barclays, which has 4,300 ATMs, said it was still negotiating with Microsoft while Santander UK, which has 2,370 ATMs, said it had already agreed a deal.

_http://www.reuters.com/article/2014/03/14/banks-atms-idUSL6N0M345C20140314

Banks to Pay Microsoft Millions of Dollars for extended Windows XP Support

Despite so many warnings from Microsoft and Cyber Security Experts, Windows XP is still being used by a number of Government organizations, Financial institutions as well as big Corporations all around the world.
If we look at the statistics then almost 30% of computers you will find that still run Windows XP, including banks, airline companies, and other huge enterprises, the count in real is likely to be even higher than the estimated.
But If you stick with Windows XP after April 8 2014, you might be at a great risk as XP will take its last breath officially on that day and will die! This fact poses danger to its users as they will be exposed to all kinds of treats. Almost thirteen years after it was 'first released' i.e. April 8 when the Redmond, Washington-headquartered Corporation will stop support for its longest running and most successful OS, Windows XP.

Continue using Windows XP after April 8, it will serve you as a Dead Zombie, because Microsoft will no longer support its own Operating System. So, the bugs and Security vulnerabilities will go forever unpatched.
It’s difficult to believe that around 95% of the 420,000 bank’s ATMs in the USA, the country which is known for the world’s largest National Cyber Security Division, also run on Windows XP, but after the deadline if a serious security flaw or vulnerability is found in Windows XP, the banks on their own will defend against the increasingly high-tech cyber criminals.
Since there is almost 29% of the desktop market share worldwide running the older version of Windows; So, a malware of epic scale could be fabricated if a suitable zero-day vulnerability was found and it’s beyond your reach that what damage and destruction, cyber criminals might cause with such exploits.
As currently 95 percent of banks’ ATMs run XP which is around 2.2 million machines worldwide. So, it’s difficult to upgrade it all to Windows 7 by the April deadline, therefore the banks have arranged or are in the process of arranging extended support for Windows XP from Microsoft.
It is estimated that for British banks alone, the cost of extending support for Windows XP would be around £50 to £60 million.
"There are certainly large enterprise customers who haven't finished their migrations yet and are purchasing custom support," a spokesman for Microsoft told a Reuters.
But, you are strongly advised to upgrade your system or if your friends or family members are still running the older version, help them upgrade to Windows 7/8 as soon as possible.

_http://thehackernews.com/2014/03/banks-to-pay-microsoft-millions-of.html?

_http://www.reuters.com/article/2014/03/14/banks-atms-idUSL6N0M345C20140314

[Arachnoid]

The cost of extending support and upgrading to a new platform for each of Britain's main banks would be in the region of 50 to 60 million pounds ($100 million),

Now wouldn't that money better be spent actually employing real live tellers who don't need any form of software upgrade then Bankers could actually seen to be supporting job growth in the present poor economy not making money from it.

Edited March 21, 2014 by Arachnoid

[dcs18]

The cost of extending support and upgrading to a new platform for each of Britain's main banks would be in the region of 50 to 60 million pounds ($100 million), according to Sridhar Athreya, London-based head of financial services advisory at technology firm SunGard Consulting, an estimate corroborated by a source at one of the banks.

Yep quite true, the cost of extending support and upgrading to a new platform for each of Britain's main banks would be in the region of 50 to 60 million pounds ($100 million) - that's nothing short of murder (some of the bank employees and some of their Customers would suffer)!!!

However, the cost of not extending support and not upgrading to a new platform would tantamount to committing suicide before the opportunity of murder - (most of the bank employees and all their Customers would suffer)!!!

[davmil]

American banks virtually force one to use the ATM. I have to pay if I go inside more than 2X a month @ Wells Fargo. Fortunately (or not) my financial life is so simple it's easy enough to do it all online and via ATM.

[Catoja]

Yeahhhh take it, force us ATM users to pay more, just because you cant do your JOB, banks do pay millions worldwide to his IT STAFF, and today 2014, ATM's can't be running on custom linux???? LINUS WARNED YOU GUYS .... NOW HE IS PROBABLY LOL...

Edited March 22, 2014 by Catoja

[ffi]

ATM's use XP embedded, it is supported until Dec 31 2016, still plenty of time to update, besides these systems are not connected to the internet directly, so there is no big risk

[CODYQX4]

.

Edited April 28, 2019 by CODYQX4

[ffi]

ATM's use XP embedded, it is supported until Dec 31 2016, still plenty of time to update, besides these systems are not connected to the internet directly, so there is no big risk

You obviously never saw that USB hack a couple months back.

You could plug USB into ATM (because in their stupidity, they have working USB ports), and hack the ATM with it with minimal effort. All these machines were running XP.

I never saw a usb port on an atm, if hackers got access to a usb port on an atm you got a whole different security issue no matter which os you run

[CODYQX4]

.

Edited April 28, 2019 by CODYQX4

[oliverjia]

I thought all the ATMs are running on Linux...