Technical and cost feasibility of EBT equipage in farmers' markets and mobile food retailers final feasibility report

              SEP IS m1
0o'1^-'A"c>l Alt.SaELdJiolFWN-USDA
Department of
Agriculture
Food MM
Nutrition
one* of
Anwysis ind
Evaluation
Technical and Cost
Feasibility of EBT
Equipage in Farmers'
Markets and Mobile
Food Retailers
Final Feasibility Report
August 1998
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USDA Technical and Cost Feasibility of EBT
Equipage in Farmers' Markets and Mobile
Food Retailers
United State*
Department of
Agriculture
Food and
Nutrition Service
Office of Analysis
and Evaluation
Final Feasibility Report
August 1998
Authors:
Woody Penn Wright
Maria Arminio
Paul Reimer
Chad Somers
Jason Darlington
Karen Kline
Submitted by:
AMA Systems, Inc.
208 North Washington Street
Alexandria, VA 22314
Project Manager Woody Penn Wright
Submitted to:
Office of Analysis and Evaluation
USDA Food and Nutrition Service
3101 Park Center Drive, Rm. 214
Alexandria, VA 22302
Project Officer: Ken Offerman
This study was conducted under Contract No. FNS-53-3198-6-027 with the Food and Nutrition Service. United
States Department of Agriculture, under the authority of the Food Stamp Act of 1977. as amended. Points of vtew or
opinions stated in this report do not necessarily represent the official position of the Food end Nutrition Service
r
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programs and activities on the basis of race, color, national origin, gender,
religion, age, disability, political beliefs, sexual orientation, or marital or family
status. (Not all prohibited bases apply to all programs.) Persons with disabilities
who require alternative means for communication of program information
(Braille, large print, audiotape, etc.) should contact USDA's TARGET Center at
(202) 720-2(00 (voice and TDD)."
To file a complaint of discrimination, write USDA, Director, Office of Civil Rights,
Room 326-W, Whitten Building, 14* and Independence Avenue, SW, Washington,
DC 20250-9410 or call (202) 720-5964 (voice and TDD). USDA is an equal
opportunity provider and employer.
%
Technical and Cost Feasibility Report Table of Contents
TABLE OF CONTENTS
ACKNOWLEDGEMENTS Iv
EXECUTIVE SUMMARY V
INTRODUCTION 1
BACKGROUND 1
PURPOSE 1
STUDY OBJECTIVES 1
RESEARCH METHOOS 2
PRESENTATION APPROACH AND REPORT ORGANIZATION 3
FARMERS' MARKET & MOBILE FOOD RETAILER ENVIRONMENT 5
DIVERSE RETAILER OPERATING MODELS 5
The Sole Proprietor 5
The Coop 6
State Run 6
PHYSICAL OPERATING CONDITIONS 7
GEOGRAPHIC DIVERSITY 8
ELECTRIC POWER AND LAND-LINE TELEPHONE ACCESS 11
EBT CARD ASSUMPTION 12
WIRELESS EBT APPROACH REQUIREMENTS 13
STAKEHOLDER CONSIDERATIONS 13
GENERAL WIRELESS EBT REQUIREMENTS 14
Retailer POS Terminal Equipment 14
Ease of Implementation/Manageability 15
Reliability 16
Secure Transaction Platform 17
Cost Effective Approach 17
POS Software 18
Geographic Coverage 19
INTEGRATION RESOURCE CONSIDERATIONS 20
SIMPLIFIED WIRELESS EBT MODEL 21
POS TERMINAL 21
INTERFACE LAYER 21
COMMUNICATIONS MEDIUM 22
EBT PROCESSING LAYER 22
INVENTORY AND ANALYSIS OF ALTERNATIVE TECHNOLOGIES, EQUIPMENT AND VENDORS ...23
POS TERMINALS 23
Desktop POS Terminal 26
Portable POS Terminal 26
Very Low Power (VLP) Wireless LAN Terminal. 27
INTERFACE LAYER 28
PCMCIA Plug In Card 28
Ancillary Module 29
Base Station Controller 29
COMMUNICATIONS MEDIUM/WIRELESS CARRIERS 30
Radio Frequency Technologies 31
Specialized Mobile Radio (SMR) 31
Two Way Paging / Messaging Systems 32
Cellular Radio Technologies 34
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Technical and Cost Feasibility Report Table of Contents
TDMA (Time Domain Multiple Access) 34
Circuit Switched- Cellular Data (CSCD) 35
Code Division Multiple Access (CDMA) 36
Global System for Mobile Communications (GSM) 36
Personal Communications Service (PCS) 37
Cellular Digital Packet Data (CDPD) 38
Handheld Device Markup Language (HDML) 39
Satellite Technologies 40
Fixed Satellite 40
Mobile Satellite 41
Medium Earth Orbit Satellite (MEOs) 41
Low Earth Orbit Satellite (LEOs) 42
EBT PROCESSING LAYER 43
Communications Medium 44
Message Formats 44
HYPOTHETICAL EBT APPROACHES FOR FARMERS MARKETS 45
APPROACH TO COSTING SURVEY 45
GENERAL CONFIGURATION ASSUMPTIONS 45
APPROACHES CONSIDERED 46
THE SOLE PROPRIETOR APPROACH 46
Portable Approach 47
Desktop Approach 49
THE CO-OP MODEL APPROACH 50
POS Terminal Equipment 51
POS Terminal Controller/Concentrator Equipment 53
THE HYBRID SMART CARD READERPRINTER/PIN PAD MODEL APPROACH 54
Smart Card Approach - Terminal Equipment 54
Smart Card Approach - EBT Processor 55
COMMUNICATION COSTS 55
SUMMARY OF APPROACHES 57
Sole Proprietor-Portable Approach 57
Sole Proprietor-Desktop Approach 58
Co-Op Model-Wireless LAN 59
POTENTIAL IMPACTS OF NEW TECHNOLOGY 60
INTRODUCTION 60
METHOOOLOGY 60
PRESENTATION OF INTERVIEW RESULTS 62
Potential Impacts On Government 62
CONCEPTUAL 62
OPERATIONAL 63
ORGANIZATIONAL 63
BUDGETARY 63
Potential Impacts on EBT Operators 64
CONCEPTUAL 64
OPERATIONAL 65
ORGANIZATIONAL 66
BUDGETARY 66
Potential Impacts on Mobile Food Retailers 67
CONCEPTUAL 67
OPERATIONAL 67
ORGANIZATIONAL 68
BUDGETARY 68
CONCLUSIONS AND RECOMMENDATIONS 70
CONCLUSIONS 70
RECOMMENDATIONS 70
Sole Proprietor 71
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//
Technical and Cost Feasibility Report Table of Contents
Coop 71
State Run 71
APPENDIX A -GLOSSARY 73
TABLE OF TABLES
Table 1 Geographic Coverage Of Wireless Technologies 9
Table 2 Potentially Suitable Wireless Carrier Data Transmission Mediums For EBT 31
Table 3 Range of Costs for Portable Wireless POS Terminals 48
Table 4 Cost Structure of Analog and Digital Cellular Communications 55
TABLE OF FIGURES
Figure 1 Wireless EBT Connectivity Model 8
Figure 2 Cost vs. Coverage Dynamics For Wireless EBT 10
Figure 3 A and B Band Cellular Coverage - United States 19
Figure 4 Simplified Wireless EBT Model 21
Technical and Cost Feasibility of EBT Equipage
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/
Pageiii
Technical and Cost Feasibility Report Acknowledgements
ACKNOWLEDGEMENTS
The AMA Systems, Inc. project team wishes to thank the many individuals who contributed to
the Feasibility Study effort. Special thanks is due to the staff of the Food and Nutrition Service,
particularly to Ken Offerman, the project officer in the Office of Analysis and Evaluation, and to
Kilolo Kijakazi who formerly held that position.
The study would not have been possible without the considerable support of EBT stakeholders
within the federal and state governments, EBT processors, FSP authorized farmers and
farmers' market managers, and consumer advocates throughout the United States.
Finally, I personally want to thank the staff at Benton International Inc., subcontractor to AMA
Systems, Inc., and particularly Maria Arminio and Paul Reimer for their exceptional support and
extensive understanding of electronic payment systems that is the basis of many sections of
this report.
Technical and Cost Feasibility of EBT Equipage Page iv
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Technical and Cot Feasibility Report Executive Summary
EXECUTIVE SUMMARY
This document constitutes the Final Report for the study of the Technical and Cost Feasibility of
Electronic Benefit Transfer (EBT) Equipage in Farmers' Markets and Mobile Food Retailers.
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Public Law 104-
193) requires all states to implement FSP EBT systems before October, 2002 unless waivers
are authorized by USDA. Farmers' market and mobile food retailers operate in environments
where electric power and land-line telephone access is not readily available. This presents a
challenge for EBT equipage.
USDA has a fundamental interest in ensuring that program participants have continued access
to farmers' markets. Consequently, a solution - either through technological or non-technological
means - is clearly needed.
The purpose of this report is to explore technological solutions to the challenge of EBT for
farmers' markets. This report does not address non-technological solutions and is purposely
limited to exploring the feasibility of wireless technologies for use in farmers' markets and
mobile retailers. While this report concentrates on current technical solutions, non-technical
fixes may be more appropriate for individual States and local markets.
It is hoped that the report can provide a useful basis for the continuing dialog with USDA's
partners. The report inventories existing and anticipated alternative technological approaches
to portable real-time authorization in on-line EBT systems and report on the technical feasibility,
cost feasibility, advantages/disadvantages of each approach, and the potential impacts of
implementing these new technologies.
Fundamental Questions to be Answered
Can procedures or hardware used or under development outside the food industry serve Food
and Nutrition Service (FNS) retailers in locations without t-yecommunicatiors or electricity,
including non-stationary retail environments? What other alternatives are feasible? How would
the feasible systems operate in an EBT context? What is required to make software and/or
hardware compatible? What are the relative costs of the various approaches identified?
Technical and Coat Feasibility of EBT Equipage Page v
in Farmers' Markets and MoMe Food Retteera /4
Technical and Coat FeawbiWy Report Executive Summary
Methodology
With no definitive information available on what exists now and what is feasible in the near
future, a comprehensive sampling frame was necessary to identify and select "technology
experts". Technology Experts identified by FNS and literature search efforts were used to
identify and assess potential wireless approaches. Technology Experts were selected to
represent a variety of alternative telecommunications, electronic funds transfer, and transaction
automation technologies. In addition, we employed a strategy of issuing a Commerce Business
Daily (CBD) Potential Sources Sought Request for Information (RFI) solicitation to maximize the
number of information sources.
Findings
The main findings of the study can be summarized quite simply. The "Inventory and Analysis Of
Alternative Technologies, Equipment and Vendors" shows that EBT equipage ir. farmers'
markets and mobile food retailers is technically feasible. The cost feasibility of EBT equipage in
fanners' markets and mobile food retailers, however, presents a much more significant
challenge since implementation cos.s must be budgeted and operating costs must be
competitive with paper systems. T-<e cost to outfit a farmer or mobile food retailer with a
wireless EBT suite is 2-3 times more expensive than the nominal cost (e.g. $400) to outfit a
traditional retailer stall for EBT.
Technical and Cost Feasibility of EBT Equipage Pagevi
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Tachnical and Coat Feasibility Raport Introduction
INTRODUCTION
Background
The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Public Law 104-
193) requires all sates to implement FSP EBT systems before October, 2002 unless waivers
are authorized by USDA. Farmers' market and mobile food retailers operate in environments
where electric power and land-line telephone access is not readily available. This presents a
challenge for EBT equipage.
USDA has a fundamental interest in ensuring that program participants have continued access
to farmers' markets. Consequently, a solution - either through technological or non-technological
means - is clearly needed.
Purpose
The purpose of this report is to explore technological solutions to the challenge of EBT for
farmers' markets. This report does not address non-technological solutions and is purposely
limited to exploring the feasibility of wireless technologies for use in farmers' markets and
mobile retailers. While this report concentrates on current technical solutions, non-technical
fixes may be more appropriate for individual States and local markets.
It is hoped that the report can provide a useful basis for the continuing dialog with USDA's
partners. This report inventories existing and anticipated alternative technological approaches
to portable real-time authorization in on-line EBT systems and report on the technical feasibility,
cost feasibility, advantages/disadvantages of each approach, and the potential impacts of
implementing these new technc'ogies.
The key audience for the study report is the USDA Food and Nutrition Service (FNS) Food
Stamp Program (FSP) which will provide information and guidance to States. FNS will use the
information to determine how to best advise States regarding the implementation of EBT
Technical and Co* Feasibility of EBT Equipage Pag*1
in Farmers' Markets and Mobile Food Retailers
Technical and Cost Feasibility Report Introduction
technologies in non-wired markets. Recognizing that very few systems have been implemented
using this technology, and little is known about its impact on efficiency and customer service,
this report will describe what technology exists, but will not draw conclusions about what is most
effective.
Study Objectives
There are three primary objectives of the overall study:
1. List and access the facto - that need to be considered in reviewing the adv-.-tages and
disadvantages of particular technologies for EBT equipage of non-w'.ed retailers in
fanners' markets and other locations.
2 Inventory existing and anticipated alternative technological approaches to portable real-time
authorization in on-line EBT systems and report on the technical feasibility, cost
feasibility and advantages/disadvantages of each approach.
3. Prepare a feasibility report that describes 3-4 hypothetical approaches that could be
deployed to routinely provide EBT equipage for non-wired retailers.
Research Methods
A number of data collection methods were used to address the objectives stated above. They
included:
• Review and Analysis of all Relevant Documentation. - A detailed and comprehensive
review of past studies pertaining to EBT implementations.
• Literature Search. - A comprehensive search of all available databases, web pages,
material and industry specifications on EBT and EFT technologies, to develop a detailed
updated inventory of relevant information.
• EBT Stakeholder interviews. - Informal interviews to ascertain information and data from
the appropriate Subject Matter Experts (SME) representing the following areas: EBT
operations, State agencies administering EBT systems, representatives of farmers'
markets, food retailers, and current EBT processors. The interviews focused on gaining a
Technical and Cost Feasibility of EBT Equipage Page 2
in Farmers' Markets and Mobile Food Retailers
It*
USDA
Food and
Consunw
Sen/icB
3101 Park
Canter MM
Alexandria. VA
22302 1500
TECHNICAL AND COST FEASIBILITY OF EBT EQUIPAGE IN
FARMERS' MARKETS AND MOBILE FOOD RETAILERS:
A CASE STUDY OF WIRELESS EBT TECHNOLOGIES
AUGUST 1998
Enclosed for your information is a copy of the "Technical and Cost Feasibility of
EBT Equipage in Farmers' Markets and Mobile Food Retailers: A Case Study of
Wireless EBT Technologies" which is the final report for the Technical and Cost
Feasibility of EBT Equipage in Farmers' Markets and Mobile Food Retailers
Evaluation.
The purpose of this report is to explore technological solutions to the challenge of
EBT for farmers' markets. This report does not address non-technological
solutions and is purposely limited to exploring the feasibility of wireless
technologies for use in farmers' markets and mobile retailers. While this report
concentrates on current technical solutions, non-technical fixes may be more
appropriate for individual States and local markets.
It is hoped that the report can provide a useful basis for the continuing dialog
with USDA's partners and in particular, serve as a resource to assist States in
making their decisions. The report inventories existing and anticipated
alternative technological approaches to portable real-time authorization in on-line
EBT systems and report on the technical feasibility, cost feasibility,
advantages/disadvantages of each approach, and the potential impacts of
implementing these new technologies.
If you have any questions regarding this report, please contact Ken Offerman.
Family Programs Staff, Office of Analysis and Evaluation, (703) 305-2124.
AN EQUAL OPPORTUNITY EMPLOYER M
Technical and Cost Feasibility Report Introduction
detailed understanding of the EBT environment from different interest groups that have a
stake in the overall concept of EBT systems but may have differing priorities, requirements
or issues.
• CBO Potential Sources Sought RFI. - Commerce Business Daily (CBD) Potential Sources
Sought Request for Information (RFI) notices were published to solicit information on
mobile point of sale (POS), telecommunications, and EBT systems and equipments from
commercial sources.
• Technology Expert Interviews. - Technology experts were selected to represent a variety
of alternative telecommunication, electronic funds transfer, and transaction automation
technologies.
This study is not controlled hypothesis testing research. Rather, mostly qualitative and some
quantitative data on technical alternatives that are likely to be successful implementations of
wireless EBT in the Food Stamp Program (FSP).
Presentation Approach and Report Organization
The need to identify approaches for the performance of wireless EBT transactions can be
defined as a business problem which requires a retail Point of Sale (POS) perspective and a
knowledge of telecommunications technologies. To help the reader assimilate the complexity
of the alternative wireless EBT technology approaches presented herein, a presentation
approach employing the following eight steps is used:
STEP 1: Orient the Reader to Technology Terms and Acronyms
Appendix A provides a glossary of terms and acronyms that are used throughout the report.
The glossary contains retail, telecommunications, and information technology terms and
acronyms that the reader will need to fully comprehend the report's technology sections.
STEP 2: Describe the Farmers' Market and Mobile Food Retailer Environment
This step describes the environment in which common types of farmers' markets and mobile
food retailers operate. An understanding of the most common forms of mobile markets
provides insight into which wireless POS approaches are best suited to meet the needs of a
particular farmers' market or mobile food retailer.
Technical and Cost Feasibility of EBT Equipage Page 3
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Technical and Cost Feasibility Report Introduction
STEP 3: Describe the Requirements for Alternative Wireless EBT Approaches
This section describes the requirements that alternative wireless EBT approaches must perform
when conducting EBT food-stamp transactions. The requirements include a combination of
factors including the technology available, geographic coverage of the wireless
telecommunications carriers, and EBT processing standards.
STEP 4: Define a Simplified Wireless EBT Model
In order to simplify the understanding of complex wireless technology concepts a general model
for handling wireless EBT transactions is discussed and represented pictorially.
STEP 5: inventory and Analyze Alternative Wireless EBT Technologies, Equipment
and Vendors
Once the requirements of the farmers' market merchant environment have been established
and a general model has been defined, alternative vendors' technology and equipment for each
component of the model are identified and evaluated for suitability to operate within the wireless
EBT transaction processing infrastructure.
STEP 6: Survey Hypothetical Approaches to EBT in Farmers' Markets
Three hypothetical EBT approaches are presented and discussed. Technical features and their
associated costs are compared. Each hypothetical approach represents the approach that best
fits the needs of the various types of farmers' markets and mobile food retailers.
STEP 7: Present Findings on Potential Impacts of New Technology
This section presents the study findings on the potential impacts that new technologies will
have on government, EBT operators, and farmers' markets and mobile food retailers. The
section contains anecdotal information from informal interviews with EBT stakeholders.
STEP 8: Discuss Conclusions and Recommendations
This section summarizes the study findings and draws conclusions on the feasibility of EBT
equipage for farmers' markets and mobile food retailers.
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Technical and Cost Feasibility Report Farmers' Market & Mobile Food Retailer Environment
FARMERS' MARKET & MOBILE FOOD RETAILER ENVIRONMENT
The acceptance of EBT transactions for food and agricultural products at farmers' markets and
mobile food retailers presents a challenge and an opportunity. Farmers' market and mobile food
retailers operate in environments where electric power and land-line telephone access is not
readily available. To fully appreciate the challenge, it is critical to understand the various types
of farmers' markets and mobile food retailers that are currently in place as well as the
environment (e.g., location, physical limitations) in which they operate.
Diverse Retailer Operating Models
Food retailers who participate in farmers' markets do business under a variety of different
organizational structures. As a result, any wireless EBT POS approach must be able to
accommodate the greatest number of farmers' market and mobile food retail operating models.
With the assistance of the Maryland Dept. of Agriculture, the following fanners' market
operating models have been identified1.
The Sole Proprietor
The most common farmers' market operation is a group of independent farmers, each of whom
has to be individually authorized to process food stamp transactions. Each merchant sells their
products during regularly scheduled times at a location that may be provided by: a local
government authority or civic group (e.g. church), a major retailer (merchandise or food) with
ample parking lot space, or the farmer's own land at a convenient intersection. The important
aspect is that no collective entity manages or coordinates the farmers' market.
The Sole Proprietor model of mobile food retailer has the following characteristics for how they
conduct business:
□ Independent operation (unaligned).
□ Sale of goods at single vendor locations (road side stands, route vendors).
1 Phone conversation between Woody Wright, AMA Systems, Inc. and Pat McMillian, Assistant to the Secretary
Director of Intergovernmental Relations, Maryland Department of Agriculture, July 24,1997.
Technical and Cost Feasibility of EBT Equipage Page 5
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Technical and Cost Feasibility Report Fanners' Market ft Mobile Food Retailer Environment
□ Sale of goods at group vendor locations (farmers markets).
□ EBT transactions are authorized individually (vendor is FSP authorized).
□ Payment for EBT transactions are settled and received individually.
Mobile food retailers (door to door food retailers operating from a vehicle and route vendors)
generally fit into the sole proprietor operating model.
The Cooo2
A small percentage of farmers' markets are run by an entity for the benefit of the group (usually
a cooperative). This model would allow for consolidation of certain EBT processing functions if
the group agreed on the scope and allocation of cost to manage EBT processing resources.
Following are the various types of coop structures that are available to process EBT
transactions:
□ A group of proprietors who have a "formal" (i.e., written) agreement in place for EBT
transaction processing services (authorization, capture and payment) with an EBT
Processor. Allowing authorization of multi-transaction processing and receipt of single point
reimbursements to the group for EBT transactions.
□ A group of proprietors operating under an informal agreement amongst themselves, each
with a separate transaction processing services agreement with an EBT processor.
□ A group of proprietors who have formed a corporation or other legal entity for the purpose of
consolidating market management and EBT processing resources.
Sftte Run
A few states (e.g., California) run and control farmers' markets throughout the state. Under
such circumstances, the state may find it economical to organize the markets in a fashion that
optimizes EBT resources.
Following are several issues that may impact EBT at state run farmers' markets.
2 The use of the term "coop" is for the convenience of the reader It is not intended to connote the same legal
meaning as a 'cooperative real estate' entity.
Technical and Cost Feasibility of EBT Equipage Page 6
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Technical and Cost Feasibility Report Farmer*' Market & Mobile Food Retailer Environment
a Methods for disbursement funding of recipient accounts.
□ Methods for EBT transaction processing.
□ Methods for payments to merchants.
□ Methods for electronic direct merchant reconciliation/funds settlement.
Physical Operating Conditions
Farmers' markets and mobile food retailers operate under physical conditions that require the
wireless POS EBT terminal equipment to be even more durable than its land-line brethren.
Terminal abuse at farmers' markets will at least be as great as the abuse a stationary land-line
terminal receives in a traditional setting. In many circumstances, the farmers' market terminal
must be even more durable than a traditional land-line terminal, as it may be repeatedly
dropped on the floor, crushed by boxes and otherwise abused. Therefore, the chosen
approach must be engineered to withstand a more abusive market than the typical stationary
POS terminal (Verifone 330 or Hypercom T7P).
In addition, the wireless POS EBT Terminal, should be able to withstand moderate extremes in
temperature. The assumption is that these POS Terminals will be used by mobile food retailers
for EBT in all but the winter season. Some farmers' markets, in moderate climates, operate
year round. Therefore, all electrical and mechanical components of the POS terminal
equipment must be able to continue to operate in moderate to extreme temperature ranges (32
-120 degrees Fahrenheit).
Wireless EBT POS terminals are also subject to more environmental extremes than land-line
POS terminals in the area of exposure to moisture. Because farmers' markets typically operate
out-of doors, the wireless POS EBT terminal equipment needs to be water and moisture
resistant. This implies that the POS terminal needs to continue to operate under the moist
conditions at a standard of performance expected of EBT POS transactions. Therefore POS
terminal equipment should not be more likely to breakdown as a result of moisture accelerating
the on-set of electrical or mechanical failure than its land-line equivalent.
Technical and Cost Feasibility of EBT Equipage P«0»7
in Fanners' Markets and Mobile Food Retailers
Technical and Cost Feasibility Report Farmers' Market & Mobile Food Retailer Environment
Geographic Diversity
Farmers' markets are located in a broad range of geographical areas, from densely populated
urban areas to remote rural areas. Because no single wireless carrier provides ubiquitous, low
cost coverage of the entire United States, it is anticipated that a variety of RF, Cellular and
Satellite carriers would be necessary to provide a seamless wireless EET approach to all
authorized farmers' market and mobile retail merchants.
The following diagram provides a high-level construct for understanding the array of wireless
connectivity alternatives that might exist in any geographic location.
Figure 1 Wireless EBT Connectivity Model
Sourca: Technical and Cost Feestttty of EBT Equipage in Farmers' Markets and Mobs* Food Retailers, May 1996.
Technical and Coat Feasibility of EBT Equipage
in Farmers' Markets and Mobile Food Retailers
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Technical and Cost Feasibility Report Farmers' Market & Mobile Food Retailer Environment
Due to the growth of wireless data transmission methods, a variety of technologies are in place
which could potentially conduct wireless EBT transactions. However, there is a tradeoff
between coverage and price. The lowest cost methods generally offer the least geographical
coverage and the most costly methods generally offer the greatest geographical coverage. For
example, Cellular Digital Packet Data (CDPD) is one of the least costly alternatives, but
coverage is only available in limited cellular zones. Whereas satellite coverage is available
virtually everywhere in the U.S., but its cost is greater than any other wireless method. Analog
Cellular systems are ubiquitous in major metropolitan areas, but lack coverage in rural areas.
While RF, Cellular and Satellite are the three primary wireless technologies, there are variants
of each which have advantages and shortcomings regarding support of EBT debit transactions.
The following matrix and diagrams identify the spectrum of wireless technologies available in
the market today, comparing technology, service provision, geographic coverage, and
illustrating the cost/geographical coverage dichotomy:
Table 1 Geographic Coverage Of Wireless Technologies
Wlialeaa
Method TaW^aHaWtaaVM^aa' a*PI»»w
Geographic
Speoakzed Motxto Radio (SMR) MOBITEX
AROB
Pomt to-Pomt
Vocet Data
3,300 tranarmBer sees
93% urban
Two Way Paging*—01
System
TDMA
CDMA
SimufcaM
Short Message Service 90% or total U S population
Analog Ceftaar
Radio
r>AMPS
TDMA
PCS
N-PCS
20,000 transmitter s*es
50% urban
Cro* Sw*ched-Oe»uler Data
(CSCO)
COMA PCS
GSM
Unknown
CaftJar Digital Packet Data
(CDPO)
Pecketaed data using
TCP-*>
19 2 KBPS
HTTP. HOML (narrowband
HTML)
Currentty in Mat phaaa, roH-out
WkeJeae
LAN
Technology
Ethernet and
TCP-JP
2MBPS Market currenBy in growth phase. limited
deployment to date
FOXED SATELLITE
Gaoeyncnronoue Earth Ort*
(GEO)
point trxnuaipoint
nxAple address service
(MAS)
Full population
. * * . . * * *■ - - - txoaccasi. moose aaepnone
•arvicaOOKBPS
MOBILE SATELLITE
Medium Earth Ort* (MEO>
Low Earth Ort* (LEO)
TDMA. SDMA. ATDMA
COMA
ATM
Capable of up to fiber light
speed two wey data with fixed
line or sot tracking antenna
Full population
Source: Technical and Cost FHisMWy of EBT Equipage n Farmers' Markets and Mobaa Food Retailers, May 1998
Other considerations are important in evaluating wireless technologies approaches for EBT:
• Is the wireless method broadly commercially exploited, as a mature technology?
Technical and Cost Feasibility of EBT Equipage
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Technical and Cost Feasibility Report Farmers' Market & Mobile Food Retailer Environment
• What are the geographic coverage vs. cost trade-offs?
• What is the credibility and scope of wireless carrier?
• Is wireless data in a transmission capability in a roll-out phase or fully implemented?
Although no single ideal approach exists today for wireless EBT many of the wireless
approaches available in the market today could support wireless EBT. The "ideal approach"
would be one that (1) meets all the functional requirements mandated for EBT, (2) is low cost,
and (3) supports broad geographic coverage. To address these requirements, the diagram
below begins with a comparison of the monthly ongoing cost of wireless technology against
geographic coverage as it exists today.
Figure 2 Cost vs. Coverage Dynamics For Wireless EBT
High
Low
//
(C»CO)
o mm
O
V '«%
' GEOGRAPHIC COVERAGE' Broad
Source: Technical and Cost Feasibility of EBT Equipage in Farmers' Markets and Mobile Food Retailers, May 1998.
A number of conclusions can be drawn from the above chart and an understanding of the cost
verses coverage dichotomy:
• Analog Cellular Radio is widely available at a reasonable cost, but has some short
comings relative to performance.
• Specialized Mobile Radio provides broad coverage at a medium-range cost.
Technical and Cost Feasibility of EBT Equipage
in Farmers' Markets and Mobile Food Retailers
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Technical and Cost Feasibility Report Fanners' Market & Mobile Food Retailer Environment
• Cellular technology offers the best balance between cost and coverage in unban areas,
but it lacks coverage in rural areas.
• Packet data switching technologies are the least costly for the areas in which they are
deployed.
• Satellite technology offers broadest land mass coverage, but is the most costly option.
• Two-Way paging is the least expensive technology and has the broadest service
coverage.
The feasibility of wireless technology cannot be evaluated on the basis of cost and coverage
alone. Equally important is the functionality of the technology and level of sophistication in
supporting data movement (e.g., as measured by data security, integrity, uptime, bandwidth
requirements, etc.). Therefore, the following observations can be made about the various
wireless technologies:
• Although Two-Way Paging offers the least costly approach, its data processing
capability is inadequate and therefore it is not suitable to process EBT.
• Specialized Mobile Radio is the most mature of the wireless mediums. Although not the
least costly, it may be the most reliable.
• Digital Cellular offers low cost service for data transmission built on a common standard,
e.g., PCMCIA. Digital Cellular uses packet switching and supports a high-speed
throughput. Although coverage is still sparse, the number of vendors supporting this
medium is growing.
• Satellite offers the best possible data capacity but the technology is expensive and not
yet fully deployed (LEOs, MEOs).
Electric Power and Land-Line Telephone Access
As stated earlier, farmers' market and mobile food retailers operate at locations where electric
power and land-line telephone service is typically unavailable or inaccessible. Farmers' markets
are frequently located in municipal, civic, or major merchandise retailer parking lots that lack
electric power and telephone access. Other mobile food retailers (route vendors and door to
door retailers) operate out of hVir truck or van. Though land-line telephone access is
impractical, given the route vendors mode of operation, modest electric power, through the
cigarette lighter receptacle, is available.
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Technical and Cost Feasibility Report Fanners' Market & Mobile Food Retailer Environment
EBT Card Assumption
Given the congressional mandate to move paper payment mechanisms to electronic payment
systems (viz. EFT 1999, FSP 2002 deadlines) a majority of states have implemented or are in
the process of implementing EBT systems. Most of the state EBT systems are predicated on
use of magnetic stripe card (magstripe) technology to leverage off the extensive commercial
infrastructure in magstripe. Accordingly, this study assumes that magstripe will be the EBT card
of choice for the foreseeable future (3-5 years). However, Smart Card technology is growing
fast3 and major commercial concerns (i.e. MasterCard International) are beginning to invest in it
because of its programmable features and enhanced security capabilities. The USDA and the
state of Wyoming recently completed a study4 of Smart Card utilization in the Supplemental
Food Programs for Women, Infants, and Children (WIC) and FSP programs that indicates
technical feasibility of the system, although costs were not lower than comparable paper
systems. "Caveats notwithstanding, the analyses suggests that the costs of off-line smartcard
EBT systems can potentially reach the range that makes EBT a viable alternative to paper
issuance systems5". 'POS terminals that read smartcards o.s well as magnetic stripe cards are
readily available, and their price is not much higher than the price for terminals reading stripe
cards only6 ". With these facts in mind it is easy to suggest that any wireless EBT approach
should consider the alternative costs of off-line nybrid smartcard (cards that have both
magstripe and smartcard capability) technology Krior to any development decision.
3 Duffy, Francis, ef a/. 1997-1998 Guide to Smart Cards in Telecommunications. Chicago, IL: Faulkner & Gray, Inc.,
1997
4 Hamilton, Paul, ef al. Costs and Impacts of the Wyoming Smartcard EBT System: Evaluation of the Wyoming EBT
System for WIC and the Food Stamp Program. Cambridge, MA: Abt Associates Inc., 1997
5 Ibid., Hamilton, Pg. 47
6 Ibid., Hamilton, Pg. 41
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Technical and Cost Feasibility Report Wireless EBT Approach Requirements
WIRELESS EBT APPROACH REQUIREMENTS
A wireless EBT approach must meet all of the requirements found in a traditional land-line
based EBT system. Thus, the wireless approach should be benchmarked against land-line
requirements with regard to all aspects of the system. The most significant difference will be in
the technology utilized to transmit data from merchant to processor and vice versa.
Stakeholder Considerations
The following is a list of general considerations that have been expressed by a cross section of
EBT stakeholders of divergent interests including; FNS representatives; EBT system operators
with current contracts with States; FSP Advocacy Groups; State Agency representatives;
Farmers' Market retailers; and other Federal Agencies
• The system should be easy to use, compact, fast, uncomplicated, and limited in
paperwork and bookkeeping.
• The equipment must be mobile, lightweight, easy to recharge, and have a long battery
life.
• Since the equipment will be mobile the system should allow for the added physical
security needed to deter theft and unauthorized use. The system should enhance the
users ability to keep Personal Identification Numbers (PINs) private by limiting the
capability for unauthorized PIN viewing.
• The system should be compatible with the existing EBT systems being implemented by
States.
• The system should minimize the time required to complete a transaction and maximize
system availability. The system should accommodate transaction volume fluctuations
dependent on location, time of day, and day of month.
• Any costs associated with operation of the system must be reasonable for the farmer
(i.e. manpower, physical security). The cost for operation and maintenance of the
system should be no more than the paper system for the government.
• Consider the training necessary for retailers, how much should be provided, how often
and to whom (e.g. owners and/or support personnel).
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• The system should be able to provide real-time authorization. If real-time authorization is
not feasible, then the system should provide timely processing in order to minimize
vendor risk.
The stakeholder considerations should be used as a guide to FNS and state EBT agencies
when defining the requirements for a specific wireless EBT implementation.
General Wireless EBT Requirements
The implementation of a wireless EBT approach should endure beyond a conceptual stage and
deliver long term performance as articulated through a pre-defined set of requirements. The
following sub-sections provide the minimum requirements for any approach to be viable over
the long-term.
The following seven requirements should be addressed during system research and design
activities:
• Retailer POS equipment.
• Ease of Implementation/Manageability.
• Reliability.
• Security of the transaction.
• Cost.
• POS software.
• Coverage.
Each of these topics is discussed in detail below:
Retailer POS Terminal Equipment
The retailer's POS terminal equipment configuration for performing wireless EBT transactions
needs to support the following features:
□ Can operate as standard common land-line based POS EBT tarminal (e.g., Tranz 330).
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□ Supports integrated PIN Pad for portable configurations (i.e., retailer key-pad and
beneficiary key-pad same).
□ Land-line based phone circuit support (only for Desktop and WIRELESS LAN equipment).
a Portable configuration as either desktop or hand-held should be light-weight instead of
bulky.
a Download of software programs from host processor to POS terminal via the wireless link
should not be required. All software should be terminal resident.
□ Terminal must be compatible with EBT processor standards (i.e. ISO-8583).
□ Where applicable, the terminal must be certified by the EBT processor.
a Terminal must read Track 1 and 2 of Magnetic Stripe Card.
□ Terminal must provide a printed receipt.
□ Battery power should provide:
Adequate level for continuous operation.
Battery level monitoring (sound an alarm when the battery is low).
A/C adapter operation mode.
Rechargeable battery power packs.
Note: Farmers, who were interviewed to determine stakeholder considerations, expressed
great consternation with the efficacy of rechargeable battery packs. In some cases, the packs
did not last the 4-6 hours necessary for a nominal market session. Some farmers admitted that
they often forget to recharge the battery pack. Most farmers experienced at least some
frustration with battery pack usage. Although electric power alternatives are not the focus of this
study, our research has identified some remote solar power sources that should be considered
when implementing farmers' market approaches.
E— of Impiementation/llanaaeabilitv
EBT Processors will be responsible for implementing any chosen wireless EBT approach.
Therefore, EBT processors must provide farmers and mobile retailers with an "EBT only"
capability (at no cost to the farmer) by October, 2002. Paper vouchers will remain part of the
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Technical and Cost Feasibility Report Wireiess EBT Approach Requirements
system as a backup. In response to this mandate, it is imperative that any chosen approach be
easy to implement, manageable and have relative longevity.
Retailers should be able to utilize a wireless approach with a limited number of problems. Any
chosen approach must integrate easily with the existing EBT/POS infrastructure, which includes
merchant and processor telephone numbers, merchant identification numbers jnd other
requirements necessary to execute an EBT transaction.
The wireiess POS equipment also needs to interface seamlessly with telecommunications
providers. in addition, approaches must interface with existing EBT and wireless
communication standards as well as existing POS terminal requirements.
The wireiess EBT approaches ultimately chosen must also be easy to manage from an
administrative standpoint. To best ensure this goal, the approaches should function in a
manner that allows the administrators of land-line based POS terminals to administer wireless
POS EBT terminals in a s similar if not identical fashion
Reliability
The wireless POS EBT approach must be able to perform over a pre-determined life span. The
down-time for repair should be similar to that of land-line based POS terminals At a minimum,
any chosen approach should function as reliably as current land-line approaches.
Two options exist that will adequately meet the reliability standards of current land-line
approaches:
□ Use of standard (land-line) electronic POS equ:omen( (e.g., Verifone Tranz 330, Hypercom
T7P).
Q Use of non-standard electronic POS equipment which is more durable than the standard
device found in supermarkets.
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Secure Transaction Platform
A secure environment for performing EBT transactions is extremely important when transmitting
data over both wireless and land-line POS approaches. However, because many wireless
technology approaches (such as RF and cellular) are less secure and more prone to
compromise than land-line approaches, even greater attention to security is required.
The level of security required for wireless POS EBT transaction should comply with the
following:
Q Use of normal Data Encryption Standard (DES) encryption techniques that provide for the
secure exchange of PINs between the POS terminal and the EBT processor, which is
common practice in the industry today.
a The entire transaction should be encrypted by the wireless telecommunications provider
through inherent carrier modulation or software add-on.
Fortunately, many wireless telecommunication mediums utilize digital techniques which provide
me encryption necessary for a secure transaction.
Coat Effective Approach
This section addresses the equipment, development, transmission and support costs for
wireless POS EBT.
An evaluation of costs will reveal that the costs for a wireless EBT approach are greatest in the
following areas:
□ Research, Design and Development (of a particular EBT approach).
□ Equipment cost, or Net Present Value (NPV) if leased, as an up-front investment (fixed
cost).
□ Wireless communications cost as an on-going/recurring cost (variable cost).
All potential wireless approaches must be priced competitively with current land-line based
approaches, ^e relative costs include both the purchase price of the POS terminal equipment
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and the on-going communication costs. In order to balance the short and long-term risks and
objectives, several questions need to be answered:
□ When assessing the costs of a final approach, how much emphasis should be placed on
up-front costs (e.g., hardware expenditures) versus long-term costs (e.g., on-going
communication costs)?
□ Can merchants provide their own wireless EBT app'oach to meet their unique business
needs?
□ Can floor limits be used for very low transaction amounts? When combined with a terminal
capture (non-host) terminal, the need for most on-line authorizations may be unnecessary.
a How important (mandated) is the goal of providing connectivity to merchants at every
farmers' market? The only option for the most remote locations may be satellite telephone
(SKYCELL. ODYSSEY).
It appears as though a wireless approach will cost considerably more than traditional land-line
approaches. However, the questions above, among others, need to be addressed in order to
determine the cost of any chosen approach.
POS Software
The software application for a wireless POS EBT terminal needs to perform in a similar manner
:o that of land-line based POS EBT terminals. Accordingly, the software must meet the
ollowing standards:
Software needs to support EBT Processor standard interface formats and protocols.
The authorization must occur "on-line".
The POS EBT software must dial EBT processor upon card swipe.
The POS EBT software must send a short authorization request message to the EBT
processor.
An approval or decline response by host is required within 15 seconds.
The POS EBT software must "dose-out" retailers daily batch of EBT transactions (i.e.,
the merchant's "deposit" function).
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Technical and Cost Feasibility Report Wireless EBT Approach Requirements
Geographic Coverage
Any wireless EBT approach's cost and configuration will be largely driven by the required
geographic coverage. A number of RF and cellular wireless providers are already available in
most urban areas. Figure 3 depicts the cellular coverage of the primary cellular carriers in the
United States.
Figure 3
A and B Band Cellular Coverage - United States
December, 1997
Source: Cellular Directions Inc., Copyright 1997, Reprinted by permission.
The largest 306 national markets are called Metropolitan Statistical Areas (MSAs). MSAs
generally have fairly comprehensive RF and cellular coverage. The remaining 428 markets are
smaller Rural Service Areas (RSAs), whose RF and cellular coverage varies from good to non-existent.
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Technical and Cost Feasibly Report Wireless EBT Approach Requirements
Obviously, if any wireless EBT approach is based in large part on standardized equipment and
processes, the less costly it will be. If it is mandatory that a approach provides connectivity to
all farmers' markets merchants regardless of location, a more costly approach is likely, both in
terms of the initial outlay as well as on-going wireless charges.
Integration Resource Considerations
Because a wireless approach requires so many differing resources to work together, a number
of challenges must be overcome before a wireless EBT transaction can occur. Implementation
of a wireless POS EBT approach requires numerous resources (e.g. research, design, and
development). Because EBT processors play such an integral role in all EBT approaches, this
section is intended to identify that integration resources are required of such third parties.
The following generalizations can be made about the extent of integration resources needed to
implement a wireless POS EBT approach:
□ The more the wireless POS EBT approach is based on 'off-the-shelf components, the less
integration resources are necessary for implementation.
□ The more the wireless POS EBT approach utilizes specialized custom built components, the
greater the demands will be for integration resources.
□ The more modular the wireless POS EBT approach is, the less the demand will be for
integration resources.
□ The volume of integration resources required to implement a wireless POS EBT approach is
directly proportional to the number of alternative wireless technologies required for the
wireless EBT approach.
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TMIHMI and Cost Feasibility Report Simplified Wireless EBT Model
SIMPLIFIED WIRELESS EBT MODEL
In an effort to simplify the discussion of wireless EBT technology alternatives this section
describes what a model wireless EBT approach will look like by providing diagrams and
descriptions of its various components. Figure 4 depicts a simplified view of a wireless EBT
model.
Figure 4 Simplified Wireless EBT Model
POS
Terminal
Interface Layer
Device
Cellular or Satellite
Communication
Network
EBT Processor
Each component of the model represents hardware and/or software functionality required in a
system. However, these component distinctions can be more arbitrary in their application when
a specific approach is defined. An example of this dichotomy is explained in the section titled
"Inventory and Analysis of Alternative Technologies, Equipment and Vendors*.
POS Terminal
EBT transactions begin at POS terminals. Whether a transaction is via land-line, RF, cellular or
satellite should be transparent to the terminal operator (i.e., the retailer), the POS terminal must
be certified by the EBT processor, accept EBT transactions and interface with the chosen
wireless platform.
Interface layer
In order to provide a modular wireless POS EBT approach for farmers' market and mobile food
retailers, a recently developed device referred to here as an "interface layer" is used. The
purpose of an interface layer is to provide a common interface between the POS terminal
device (e.g., Verifone, Hypercom) and the wireless carrier (RF, Cellular, etc.). Thus, a terminal
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Technical m4 Coat FeastoiWy Report Simplified Wireless EBT Model
which is manuf. .-fared as a land-line terminal can be converted into a wireless terminal through
the use of interface layer components.
Communications Medium
Ideally, the communication medium of the model wireless EBT approach should be able to
provide easy and inexpensive connectivity to any urban or rural geographic location in which a
farmers' market may be based. Although complete (ubiquitous) geographic coverage can be
attained, it can not be done with a single vendor or technology. Therefore, a multi-vendor
technology environment is likely However, it is not easy or inexpensive to interconnect
competing vendor technology
EBT Processing Layer
Regardless of the technology utilized for the model wireless approach, it needs to interface into
the existing EBT processor infrastructure (e.g. Deluxe Data, Citibank, Transactive) by
conforming to existing standards. This means that the input of wireless EBT transactions to the
EBT processor should be based upon the X.25 or similar protocol and use standard POS
terminal message format standards (i.e., Visa I and II, ISO 8583).
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INVENTORY AND ANALYSIS OF ALTERNATIVE TECHNOLOGIES,
EQUIPMENT AND VENDORS
Any chosen wireless EBT approach needs to incorporate industry standards while meeting the
needs for each of the farmers market and mobile food retailer operating models. The
approach must also strike a balance between meeting the needs of the various mobile
merchants and controlling costs so that the wireless EBT approach is sustainable over the long
run.
This section is organized into sub-sections based on the simplified wireless EBT model
components discussed in the previous section. The features of alternative technologies,
equipment components, and vendors are described and their suitability as a wireless EBT
approach is analyzed.
POS Terminals
This section describes the various types of POS terminals which are available to farmers'
markets and mobile food vendors. Several types of POS EBT terminal approaches exist that
will meet the needs of farmers' markets. Each of the terminal approaches covered in this
section have wireless capabilities.
A viable retail approach for farmers' market Wireless EBT is based upon a combination of
technologies and vendors wtvch provide a suitable wireless EBT POS configuration which
meets the stated needs.
POS terminals are necessary components of all EBT programs. The POS terminal is the
device that allows transactions to be authorized and settled, the two basic elements of all EBT
programs. Authorization and settlement allow funds to be shifted between governmental
entities, recipients and retailers.
The purpose of wireless POS terminals is to allow mobile vendors to authorize and settle
transactions from remote locations where land-lines are inaccessible, impractical or otherwise
unavailable. The basic processing requirements of a wireless transaction are the same as
those of a traditional land-line transaction. As a result, the POS industry realizes that it must
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leverage off of the existing POS infrastructure in order to ensure the successful implementation
of wireless POS. Standards are currently being established by industry groups, hardware and
software vendors, and credit card processors that allow traditional land-line POS protocols to
apply to wireless POS transactions via a number of wireless communication platforms
The communication platform that eventually captures the wireless POS market (e.g., analog
cellular, satellite or UDPD) should not have any bearing on how EBT POS transactions are
structured from a processing and user perspective. Terminal hardware vendors will continue to
manufacture terminals which are operationally compatible with exiting EBT POS procedures.
The communication interface will simply vary based on accepted wireless communication
platforms. Thus, the internal communication technology may evolve over time, but the basic
EBT POS transaction requirements will remain constant.
As previously mentioned, any wireless EBT program that is implemented must leverage off of
the existing land-line based EBT POS infrastructure. Therefore, it is imperative that POS
terminals implemented in a wireless setting offer the same features and functionality of land-line
EBT terminals. The end-user must be able to utilize a wireless POS terminal in exactly the
same manner as he or she would utilize a land-line terminal. The physical encasing, card
reader, PIN pad and receipt printer of all wireless POS terminals must be equivalent to land-line
terminals with respect to features and functionality. It should be noted that wireless POS
terminals may need to be more rugged than land-line terminals for the simple reason that
mobile terminals are likely to encounter greater physical abuse than land-line terminals.
The distinction between wireless and land-line terminals is seen in the communication platform
each uses to transmit data. In simple terms, land-line terminals tiansmit data via traditional
land-based telephone lines, while wireless terminals transmit data via any number of wireless
communication platforms. The dichotomy between the two terminal types is found internal to
the actual POS device. For wireless POS terminals, manufacturers simply configure their
device to interface with any one of a number of wireless platforms. In fact, some manufacturers
have configured their terminals to interact with multiple wireless platforms all through a single
device. Such multi-platform devices allow the terminal to be used with whatever communication
protocol is available in a particular market.
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Most major terminal vendors are aware that a significant demand exists for wireless POS
terminals. In response, many vendors have already developed functional terminals or are in tfw
process of developing functional units. Most of the devices that are currently on the market are
compatible with traditional analog cellular and RAM Mobile Data MOBITEX Because those
communication platforms have predominated over the past several years, terminal vendors
were quick to enter the market where there was existing coverage and accepted technology.
As a result, there are numerous wireless POS devices configured to interact with analog cellular
and RAM Mobile Data MOBITEX platforms.
Recently, the trend has been to manufacture terminals that interface with wireless platforms
which offer fast, price-friendly coverage, as well as platforms that offer expanded geographic
coverage. For example, a growing number of manufacturers offer terminals that are compatible
with CDPD technology. CDPD offers fast authorization response time as well as friendly pricing
schemes that bill by bytes of information rather than amount of air time. The Hypercom T7PRA
is one such example of a fully integrated POS terminal that interfaces with CDPD.
As wireless POS use increases and as more wireless communication platforms gain nation-wide
coverage, a more versatile POS terminal will become commonplace. The POS terminal of
the future will likely be a multi-platform wireless unit. The multi-platform wireless unit will be
able to interface with any number of wireless platforms depending on the availability of service,
cost of transaction and required speed of authorization. A device which allows the end-user to
switch between various wireless platforms will allow retailers to be truly mobile through the use
of the same terminal whether securing authorizations via satellite, analog cellular or CDPD.
The most robust multi-platform terminal available is the SOLO made by Omega Digital. The
SOLO is capable of interfacing with a number of wireless platforms, including RF Wan, ARDIS,
Ram Mobile Data MOBITEX, CDPD, GSM, and PCS.
Hypercom's CDPD compatible terminal is demonstrative of current trends in the wireless POS
terminal industry while Omega Digital's SOLO provides the most provocative glimpse into the
future of wireless POS terminals. Both Hypercom and Omega Digital demonstrate that wireless
POS is not driven by terminal manufacturers, but by the communication platforms that support
wireless data transmission. Operational terminal performance will remain constant from the
end-users perspective but will continually be updated from a communications perspective.
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EBT transactions begin at POS terminals. Whether a transaction is land-line, cellular or
satellite should be transparent to the terminal operator (i.e., the retailer). The POS terminal
must be certified by the EBT processor, accept EBT transactions and interface with the chosen
wireless platform. A discussion of the various POS Terminal configurations and representative
examples follow. Appendix A contains a more detailed breakdown of specific POS Terminal
capabilities by vendor and Appendix B contains specific vendor product literature for the
readers perusal.
D—ktop POS Terminal
Desktop
A desktop POS terminal can be either land-line based or wireless. A desktop
terminal is generally heavier than portable POS terminals and often are part
of a full-functionality electronic cash register, or stationed adjacent to the
merchant's cash register. A desktop terminal would likely be affixed to the
merchant's table, which would help prevent theft of the device.
Examples of desktop POS terminals include:
Hypercom T7P Desktop POS terminal with buM in printer
Ultimate Technology POM3500 Compact Pomt-of-Sale Terminal Desktop POS Terminal.
Verifone Omni 2650 Built-in printer and PIN pad. Infrared or
tethered to docking station.
Portable POS Terminal
Portable POS terminals will always utilize some form of wireless connectivity
to send data to the card processor. Portable terminals can be carried by a
merchant as they conduct business with their customers. Portable POS
terminals are single-user units that do not require any interface with another
device (e.g., a docking station or an electronic cash register). For many
retailers in farmers' markets, the best approach for wireless EBT will be a stand-alone single-user
POS terminal (either Desktop or Portable).
Portable
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Technical and Coat Feasibility Report Inventor/ & Analysis of Ait Technologies, Equipment & Venoors
The portable POS Terminal must meet the following performance requirements:
• Dial via RF or cellular to the EBT Host Processor directly through a wireless carrier.
• Can be carried by merchants as they conduct business with clients (i.e., the terminal is
easily transported during business use).
• Integrated PIN pad is preferred, but acceptable to have a separate PIN pad if it is
compact and it is the only ancillary device to the POS terminal.
e Has a built in printer.
Examples of this type of POS terminals include:
Hypercom T7PRA
T7PRC
Portable POS terminal with battery, radio, and
built-in printer.
CDPO version.
Omega Digital Data Glider POS Transaction Terminal Portable POS Terminal.
Omni 3000 Attached printer, integrated PIN pad, PC modem
card with antenna, CDPO packet data.
Very Low Power (VLP) Wifeless LAN Terminal
New wireless approaches have begun ' '• emerge which look like
potential approaches for the farmers' market EBT environment.
Recent developments in the "wireless ethernet" and "wireless
token-ring" categories have made this category worthy of
SVLP LAN consideration.
One such emerging technology is the WIRELESS LAN. A Very Low Power Local Area Network
is used for short range connectivity between one or more POS terminals and a PC based host
(file server). The wireless POS LAN terminal has a range of up to 3000 feet away from the
base station. Base-station to base-station can achieve ranges of 25 miles.
Channel security does not inherently exist for this type of technology. Therefore, there is a
need to implement encryption for each transaction. Robust error correction is required to
overcome ambient signal noise (ghost) between POS and LAN controller
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Technical and Cost Feasibility Report Inventory & Analysis of Ait Technologies, Equipment & Vendors
Examples of this type of equipment include:
Comtm ' -'. .'.It&^j^jjfcyj^^jgjjsj^^j^^^'sj/^^^^JJJ^^J^^^^^^^
OTC telecom AurEZY2400 wireless Ethernet 300 foot range.
Symbol Technologies Spectrum24_ Wireless ON 2 MBPS per second.
The wireless LAN is an example of the arbitrar, jmponent distinction dichotomy discussed in
the "Simplified Wireless EBT Model" section. The wireless LAN and the "Base Station
Controller" are elements of the same functional device. The device functionality encompasses
aspects of two model comporwrts, namely POS Terminal and Interface Layer.
Interface Layer
In order to provide a modular wireless POS EBT approach for farmers' market and mobile food
retailers, a category of recently Jeveloped devices, referred to here as the "interface layer", is
used. The purpose of an interface layer is to provide a common interface between the POS
terminal device and the wireless carrier. Thus, a terminal which is manufactured as a land-line
terminal can be converted into a wireless terminal through the use of the interface layer.
By using this technology, a number of benefits may be realized by stakeholders. Benefits
include:
• Cost savings and reliability through use of traditional land-line POS terminals.
• A flexible communications environment, since any wireless carrier could be used with a
common POS terminal set-up.
• Maximization of wireless coverage through use of various wireless platforms.
There are two types of hardware technology that fit the interface layer model, "PCMCIA Plug In
Cards" and an "Ancillary Module". Specialized software is required with each technology to
provide a translation between standard EBT POS transactions (Visa 2 format or HDLC 8583).
PCMCIA Plug In Card
The Personal Computer Memory Card International Association (PCMCIA) card is a common
interface in laptop computers and is beginning to be used in a wireless mode for Personal
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Digital Assistants (PDAs). PCMCIA boards are available for both cellular and RF applications.
The PCMCIA card is generally a type III or a type II card with a belt-attached cellular phone
connection.
The advantage of PCMCIA is that it is not specific to any one terminal, as the card is a standard
interface. Therefore, the same POS terminal can support one or all wireless carriers.
Providers of these products include:
COMPANY
■
COMMENTS
U.S. Robotics AllPoints WirsieM PC Card $499 lat.
Aironet Wireless Communications ARLAN PCMCIA Wireless LAN Adapter $695 list
The PCMCIA Plug In Card appears to be ideally suited for wireless POS EBT. The downside is
that none of the largest POS terminal vendors (Verifone anc Hypercom) are currently
supporting this standard.
Ancillary Module
The Ancillary Module typically is an add-on to a base POS terminal which provides access to a
specific communications earner. Ancillary Modules have traditionally been develooed for RF
applications, such as RAM Mobile Data network.
As an interface layer device, the ancillary module is less desirable than PCMCIA because it
must be engineered for each specific terminal.
Providers of these products include:
Mobiterm AB
Verifone
MtcroSYSTER
Backpack
Base Station Controller
The technology of short range wireless!AN communications has been rapidly evolving over the
Technical and Cost Feasibility of EBT Equipage
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Technical and Cost Feasibility Report Inventory & Analysis of AM Technologies. Equipment & Vendors
last couple of years. This technology explosion is especially true for PCMCIA wireless ethemet
approaches, which provide connectivity up to 3000 feet in range between a base station and the
POS terminal.
The new devices offer numerous advantages, such as:
• SNMP (simple network management protocol) management.
• Easy connectivity to LAN environment.
• High-speed connectivity (3-Mbps).
Vendors of this type of wireless approach are:
COMPANY Pwaocrsomma
BLACK BOX PCMCIA Adaptor
BLACK BOX WffBiMs ACCOM Point
Communications Medium/Wireless Carriers
Ideally, the communication medium of the model wireless EBT approach should be able to
provide easy and inexpensive connectivity to any urban or rural geographic location in which a
fanners' market may operate. However, although complete geographic coverage can be
attained, it can not be done with a single vendor or technology. Therefore, a multi-vendor
technology environment is the reality.
A variety of communication platforms may be suitable to meet the needs of a wireless POS
EBT approach. A number of factors must be considered when determining which
communication media that will be used.
The following matrix illustrates many of the factors that will determine which approach works
best for the farmers' market. Each of the potential approaches is reviewed and critiqued in the
following sections.
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Table 2 Potentially Suitable Wireiess Carrier Data Transmission Jediums For EBT
■annul Taannototw ..ll***** l*i^ehf*aK^
Spebanad Mobile
Radio (SMR)
MOBITEX
ARDIS
Point-to-Point
Voice & Data
4.8k to 19.2 k
BPS
PCMCIA
Attachable module
Two Way Paging/
MMMylny oyWOfTTS
TDMA
CDMA
Simulcast
Short Massage Service 180-500
characters per
message
PCMCIA
Analog
Cellular
Radio
D-AMPS
TDMA
PCS
r*-pcs
8k BPS Analog ceHuler
modems & cable to
phone port
Circuit Switched-
CeNularData
(CSCD)
CDMA PCS
GSM
14.4 KBPS Sensl cable & phone
port for cellular
modem
CaHular Digital
Packet Data (CDPD)
Packattzsd data using
TCP-IP
19.2 KBPS
HTTP, HDML
(narrowband HTML)
19.2k BPS PCMCIA or butt in
to device
FIXED SATELLITE
Geosynchronous
Earth Orbit (GEO)
pomt-to-multipoint
multiple address
service (MAS)
36MBPS. or
1200 voice
channels
Transceiver antenna
satellite handset and
cable
One way broadband
data broadcast, mobile
telephone service Q
4.8 KBPS
MOBILE
SATELLITE
MocHuin EeWtti Orfcit
(MEO)
Low Earth orM
(LEO)
TDMA, SDMA,
ATDMACDMA
ATM
Fiber light speed two
way data with (bead line
of site tracking antenna
155.52 MBPS. or
100K 16 KBPS
channels.
Beam steering
antenna tracking
mechanism
Source: Technical and Cost Feasibility of EBT Equipage in Farmers' Markets and Mobile Food Retailers, May 1998.
Radio Frequency Technologist
Specialized Mobile Radio (SMR)
SMR is one of the oldest commercially exploited wireless technologies. SMR technology takes
a radio frequency used for dispatching trucks and taxis and digitizes it. Its ra^ge is 25 times that
of analog cellular. Call handling capacity is large and costs are projected to be 10%-15% less
than cellular. There are two major vendors who compete in this market:
Commr J^ODMerraQwWiti COMMENTS
RAM Mobile Data MOBITEX Better coverage than CDPD but not as
broad as cellular
Motorola ARDIS Similar to RAM - Switched packet RF
data network.
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RAM Mobile Data MOBITEX is a partnership between RAM Broadcasting Corporation and
BellSouth. The RAM Mobile Network operates throughout the United States, covering more
than 93 percent of the urban business population. RAM's core technology is MOBITEX, an
open systems wireless mobile data architecture that provides wireless data connectivity.
RAM has 1,000 multi channel base station sites with 1,300 channels. Over the next four years,
RAM will be deploying another 500 base stations increasing coverage to 96% of the urban
business population.
Advanced Radio Data Information Sen/ices (ARDIS) is the nation's first and largest two-way
wireless data network, covering the top 400 metropolitan areas of the U.S., Puerto Rico, and
the Virgin Islands, which accounts for more than 90% of the business activity and 80% of the
nation's population.
The ARDIS' network is deployed through base stations that are connected back id network
controllers in hub cities via dedicated leased telephone lines. ARDIS currently has about 1,400
channel base stations occupying 1,100 cell sites. The ARDIS' base stations are single cell
channel units.
Two Way Paging I Messaging Systems
Direct broadcast satellites are being used by paging systems as the dUa communications link
between paging terminals and paging transmitters. After processing the signal, the transmitters
beam tl e signal toward a satellite in a geo-stationary orbit, 22,000 miles above the earth. The
satellite receives the transmission, processes it and sends it back to earth where a small
satellite dish at each transmission site receives the signal. Ground transmitters then simulcast
the paging signal within a specific geographic area.
There are two types of paging systems:
• One-way paging
One way paging provides users with the ability to be notified/alerted with a phone number to
call back, or notified/alerted by a short message. Data is transmitted one way at 2400 BPS
and one 160-character display per second.
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• Two-way paging
Two way paging provides usars with the capability to receive messages/pages and respond
to such messages/pages. Because the service uses two networks (one for sending and
another one for receiving), there is a delay in receiving the two-way user's response. Size of
message sent is 500 bytes; the return is 95 to 200 bytes.
Short Messaging Service (SMS) services the high end paging market, which is where cellular
and paging begin to overlap SMS is a bundled paging and messaging service which supports
voice communication through a single pager device. It is a text based messages service. SMS
messages are 160 characters in length. When the message exceeds 160 characters, it is
automatically dispatched as several short messages (packets).
Some enhancements to the current paging systems are:
• SMS CDMA. - 255 character messages at 9600 BPS to the mobile receiver and 4800 BPS
from the mobile receiver.
• TDMA SMS. will be available in 1997 and is capable of transmitting a 256 byte text
message to and from the subscriber device.
• Narrowband PCS (N-PCS). is a new two-way paging and messaging protocol, designed
for complex paging, telemetry, vehicle tracking and short messaging. The message center
lets customers communicate with GSM, CDPD and TDMA users.
Two-way paging service in which the pager device is a full alphanumeric keyboard, message
can be initiated by either pager device or base station.
Some examples of service providers in this area include:
COHPAIIY PRODUCTS OFFEKEO COMMENTS
PageMart Wireless. Inc Provides wireless messaging services
to over 2 miMon people in aft 50 states
The industry's most extensive nationwide
network.
RAMfirst Interactive Paging Service Two-way paging service in which the
pager device w a full alphanumeric
keyboard, message can be initiated by
either pager device or base station.
Ericsson GSM Data Card. GC25 PCMCIA Type III Data Card and Short
Message Services (SMS).
Ericsson personal Air Communications
Technology (pACT)
This service is being replaced by N-PCS
due to decision by AT&T, major backer of
pACT.
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SMS appears to be an attractive approach for wireless POS EBT due to the low cost of
equipment and communication. However, the technology appears to be unsuitable for EBT
because messages are sent and received between the base station and the device at pre-set
timed intervals which far exceed EBT standards for real-time authorization in 15 seconds or
less.
Cellular Radio Technologies
By most estimates, more than 90 percent of traffic on the U.S. cellular phone network is voice,
but data transmission is growing rapidly. Analog cellular systems based upon the Advanced
Mobile Phone Service (AMPS) standard has been the technology that has proliferated to date.
However, this is increasingly being replaced by digital techniques and systems.
Traditional analog cellular systems have the capability to transmit data using specialized analog
modems. Some enhancements to the analog cellular radio which enable this to occur are:
TDMA (Time Domain Multiple Access)
TDMA is a circuit-switched data transmission modulation technique used for digital/analog
cellular networks. Currently, the cost and performance of TDMA does not appear to meet
customer expectations, presumably due to limited data through-put handling capacity.
TDMA is currently predominantly a voice-only digital cellular option. However, data services are
in the process of being implemented. TDMA promises a threefold increase in capacity over
traditional analog cellular service. TDMA was designed to coexist with the current AMPS
network so that base stations can support both analog and digital services. Providers are
combining Cellular Digital Packet Data services with TDMA, an approach that delivers data and
faxes at 9.6 KBPS to 14.4 KBPS.
Some pros and cons with this technology include:
Pros:
Future data services (potential use of CDPD for data).
Data encryption inherent in modulation technique.
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Cons:
Inferior voice quality.
Limited coverage.
Some analog cellular vendors who support TDMA based data transmission include.
comtm PRODUCTS OFWRtD
GTEVWreleM TDMA Analog CstMaY Radios
ATATWirelen TDMA Analog Ceftjlar Radio*
NOTE: AT&T is the largest cellular carrier in the United States. Its service area covers 40
percent of the United States population and it provides cellular phone service to over six million
users. In 1995, AT&T obtained 21 additional licenses which, when fully constructed, will
increase their coverage to over 80 percent of the United States population.
The Wireless Data Division of AT&T Wireless Services offers a wireless data service based
upon TDMA, CDPD and CSCD. However, although analog cellular has the greatest coverage in
the U.S. at the current time, it is considered to be unreliable from a data standpoint and difficult
to set-up.
Circuit Switched- Cellular Data (CSCD)
CSCD creates a dedicated connection or circuit over the analog cellular network for the
duration of the call, with cellular transfer rates up to 14.4 KBPS. Transferring data with CSCD
requires a data-capable cellular phone, a connector cable and a cellular modem (preferably a
PCMCIA Card). As with voice, charges are determined by call duration. The cost of a CSCD
call ranges from $.30 to $.60 per minute depending on location. CSCD is billed the same way
as a voice call. The CSCD technique is based upon use of CDMA (code division multiple
access) over AMPS, or GSM technologies. Some pros and cons of this technology include:
Pros:
Good for large file transfer/on-line data.
Voice and data capabilities.
Low-cost devices.
Nationwide coverage.
Easy to use.
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Technical and Cost Feasibility Report Inventory 4 Analysis of AH Technologies, Equipment & Vendors
Extensive applications software.
Good developer support.
Cons:
Problems with reliability, as transmissions can drop when moving between cells.
Security (data encryption is an aod-on)
Call billed by the duration of the call and not the amount of information transmitted.
Some emerging digital technologies for wireless data transmission include:
Code Division Multiple Access (CDMA)
CDMA is available on a limited basis and promises as much as ten-times more capacity than
traditional analog cellular service. It is designed to coexist with the current AMPS network
national infrastructure so that base stations can support both analog and digital services.
Performance for wireless data service is between 9.6 KBPS to 14.4 KBPS.
Pros:
Good for short messages.
Data encryption inherent in modulation technique.
Potential for higher data rates than TDMA.
Cons:
Limited coverage, not nationwide.
Expensive communications tariff (for voice calls there is a 1 minute minimum call duration
and a minimum of $0.20 per call).
The digital handset is expensive.
Limited data applications availability.
Global System for Mobile Communications (GSM)
This global platform for digital wireless communications is the digital cellular telephone standard
in Europe and Japan with deployment planned in more than 70 countries. There is currently
only a limited roll-out of GSM in the U.S., yet GSM could become the global digital standard in
the distant future.
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Technical and Cost Feasibility Report Inventory & Analysis of AN Technologies, Equipment & Vendors
GSM also supports enhanced data service functions. Subscribers access services by inserting
a subscriber identity module (SIM) or smart card into their cellular phone or potentially into any
terminal device across multiple networks.
The GSM 1 9 GHz phones use a variant of TDMA designed to run over analog wireless phone
networks.
Pros:
Built in encryption from digital modulation.
Short message services for text and numeric messaging.
Low-cost devices.
Cons:
Very limited coverage in U.S. (coverage in Washington, D.C. and Honolulu).
This type of service is offered by:
com>*m
Nokia
Aerial Communications
Primeco Communications
9000 Communicator for GSM Networks
Targeting GSM Network Services
GSM Cellar Network
Persona/ Communications Service (PCS)
PCS networks transmit at higher radio frequencies than current cellular systems - in the range
of 1,850 to 2,200 megahertz (MHz) compared to about 800 MHz used by conventional cellular
networks. In addition, PCS networks are 100% digital and offer consumers more choice and
new services. Because of PCS' greater capacity and digital technology, PCS calls are superior
in quality to traditional cellular. Secure communications are also provided by CDMA digital
encoding.
PCS can be provided on AMPS based cellular networks as well as GSM networks under a
service known as "general packet radio" services.
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There are two types of PCS systems:
• Broadband PCS is in the 2 GHz band of the electromagnetic spectrum from 1850 to 1990
MHz. The spectrum allocated for Broadband PCS totals 140 MHz; 20 MHz in that block is
reserved for unlicensed applications that could include both data and voice services.
• Narrowband PCS is defined as a family of mobile or portable radio services used to provide
wireless telephony, data, advanced paging services such as voice message paging, two-way
acknowledgment paging, and other text-based services. Narrowband PCS uses a
smaller portion of the spectrum than Broadband PCS, in the 900 MHz band of the
electromagnetic spectrum.
Providers of PCS services include:
COMPANY mmmtmmm -
QUALCOMM Q Phone Developer of original PCS phone concept.
GTE Wireless PCS Service. Broadband, Narrowband Very extensive service offering.
Aerial Communications GSM Network Services Service roMng-out in tiled cities.
CyoMogic Voltaire GSM/PCS Specialized when GSM needed.
Ericsson GSM Data Card GC25 PCMCIA TYPE III data card
Ce/fu/ar Digital Packet Data (CDPD)
CDPD is a new type of digital transmission using the existing analog cellular network that offers
low-cost access using Transmission Control Protocol/Internet Protocol (TCP/IP). CDPD folds
data into packets and transmits them at high speeds (19.2 KBPS) over idle channels of existing
(but upgraded) cellular voice networks This option routes data packets, eliminating the need to
establish an end-to-end connection. Therefore, users and network operators can take full
advantage of Internet developments as they come to market.
CDPD uses the temporarily idle channels in the cellular telephones systems to transmit data.
CDPD is intended to provide national service, but will be operated by regional carriers. Once
the systems are deployed, each of the service providers intends to host subscribers from other
systems in order to give the appearance of a single seamless national service. The union of
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operators, however, has not yet developed the technology required to offer a single point of
contact for national subs:ribers (i.e., roaming between operators and consolidated invoicing).
With CDPD, users are charged on a per-packet basis, which means they pay for only the data
that is actually transmitted. This allows CDPD users to save when sending and receiving short
messages while still enjoying the benefits of being mobile.
Pros:
Good for short data messages and Internet access.
Fast transmission times (19.2 KBPS).
Good security (data encryption provided by earner).
Reliable because it is designed for data.
PCMCIA cards are available
Has embedded TCP/IP standard.
Cons:
Under the CDPD platform, data communication is subordinate to voice, exposing critical
data applications to potential delays and congestion.
Limited coverage/new service.
Difficult to configure.
Limited software and vendors applications.
Since CDPD incorporates the TCP/IP protocol, it acts as a switch method for wireless networks
to be tied to the Internet. An innovative application of CDPD gaining support as a result of this
Internet connectivity is HDML.
Handheld Device Markup Language (HDML)
HDML (Handheld Device Markup Language) is a markup language similar in structure and
syntax to HTML (Hyper Text Markup Language). In the tradition of the World Wide Web,
HDML sits alongside HTML. Its main innovation is its compactness and its optimization of
space for devices which have small screens, constrained user interface, little or no pointing
device, and limited keyboard input. HDML preserves the programming model of the Web and
HTML applications.
Initially targeted at GSM-tec nology networks, HDML aims to align industry efforts to bring
Internet applications, content, nd technologies to digital cellular phones. A common standard
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means that cellular phone manufacturers have the potential of benefiting from economies of
scale. The draft protocol has been made available to cellular phone manufacturers and
operators around the world and published on the World Wide Web.
The following are examples of providers of this type of technology:
mmm
Alcatel One TouchTM PRO GSM Phone.
AT&T Wireless Services AT&T PockatNeL
Unwired Planet HOML. Wireless Application Protocol
(WAP).
Ericsson HOML cofnpflbbto phases.
Motorola HDML compatible phases.
Nokia HOML compatible phases.
The future of CDPD seems bright since the network is owned by cellular carriers with significant
financial assets who are willing to promote it.
Satellite Technologies
Fixed Satellite
Fixed satellite technology is known as GEOs (Geostationary Earth Orbit Satellites), They orbit
the earth at a fixed point at approximately 22,300 miles above the equator, stationed in geo-synchronous
orbit, thereby continually holding the same position over Earth at all times. These
Geostationary satellites use spot beams that cover the entire continental United States, Alaska,
Hawaii and the Caribbean
A broad range of voice, dispatch, data, fax and positioning services are available throughout
North American through terminals equipped with compact masts or dome antennas.
Geostationary satellite systems are best suited for high-speed data, television transmission,
and any other wideband applications. Nonetheless, GEOs are used for telephone/data
transmission.
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Technical and Cod Feasibility Report Inventory ft Analysis of Alt Technologies. Equipment ft Vendors
A prominent provider of this type of service is:
SKYCELL OMNK3UEST SATELLITE
TELEPHONE
■' ■ ■'-
COMMENTS
GEOs
The AMSC-1 satellite was launched in April 1995 and a twin satellite MSAT-1 was launched in
April 1996. Each satellite backs up the other. The SKYCELL telephone costs approximately
$2,000 and can communicate with AMSC-1 or MSAT-1 for $1.40 per minute.
Fixed satellite appears to be an attractive approach for wireless POS EBT. However, it is one
of the most costly approaches, and the telephone services are subject to atmospheric
disturbances.
Mobil* SatrnMH*
There are two types of mobile satellite systems:
• MEOs (medium earth orbit satellites) - 5,600 mile orbit.
• LEOs (low earth orbit satellites) - 300 to 750 mile orbit.
Medium Earth Orbit Satellite (MEOs)
MEOs orbit at an altitude of approximately 6,000 miles which is high enough to let each satellite
"see" about one-quarter of the Earth, yet avoids the signal delays inherent to satellites in geo-synchronous
orbit. All processing takes place in earth stations, where upgrades, maintenance
and repair are easy.
MEOs have not been utilized extensively for commercial data transmission applications to date,
but some new systems are starting to be rolled out which will offer vast new data services. One
such satellite based system which transmit data via MEOs is:
COMWtfW PRODUCTS OWEWD COMMENTS
Odyssey MMMl bsssd wirslsss ftsphons
connectivity
MEOs SsteflMs ConstsMafton.
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Odyssey is intended to provide worldwide high-quality satellite-based wireless telephone
connectivity and other personal communications services. The Odyssey configuration will
eventually have 12 satellites circling the globe in medium-Earth orbit. TRW Inc. and Teleglobe
Inc. are founding shareholders in Odyssey Telecommunications International Inc. (OTI), which
will implement and operate the Odyssey system. Seven Earth stations, connected by leased
fiber optic cables, form a global wide-area network (WAN). This system is highly automated,
which permits easy upgrades and maintenance of processing functions. Gateways link the
Odyssey global WAN to Public Service Telephone Networks (PSTNs). Odyssey has one
system operations center and a back-up center. Odyssey satellite telephone will be handheld
or fixed dual-mode (compatible with local cellular).
Low Earth Orbit Satellite (LEOs)
LEOs satellite systems offer significant advantages over geo-synchronous satellites for the
delivery of satellite data services due to their orbit which allows signals to be picked-up by low-power
mobile hand-held equipment.
Some providers of LEO service include:
COMPANY PRODUCTS OFFERED COMMENTS
GLOBALSTAR LEOs satellite network 48 x 750 mi. Send/receive calls vie cell phone.
IRIOIUM LEOs satellite web 66x. MAJOR IMPACT wireless landscape.
TELEDESIC LEOs satellite constellation 840x Broadband fiber speed direct to homes -
interactive video target.
Globalstar
Globalstar is a satellite-based constellation of 43 satellites in a 750 nautical mile orbit above the
Earth. The wireless telecommunications system is designed to provide voice, data, fax, and
other telecommunications services to users worldwide.
Users of Globalstar will make or receive calls using hand-held terminals similar to today's
cellular phones. Calls will be relayed through the Globalstar satellite constellation, to
groundstations, and then through local terrestrial wirelines and wireless systems to their end
destinations.
The first four (4) of 48 satellites in Globalstar's worldwide network were launched on February
14, 1998.
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IRIDIUM
Motorola's Satellite Communications Group is the prime contractor for the Indium system, which
includes an international consortium of 17 investor organizations representing leading
telecommunications and industrial companies worldwide.
The IRIDIUM project will employ 66 low earth orbit satellites for mobile phone, voice, character,
and data communication. IRIDIUM satellites talk to handsets, ground stations, and each other,
forming a network aloft, passing along conversations and handing them off when they dnft out
of range. The IRIDIUM system will be able to handle calls by routing the signal from handset
straight to an Iridium satellite, as no ground stations are needed.
IRIDIUM phones will have a standard RS232 interface port built into each handset to support
data and facsimile transmissions. Batteries will yield at least 1 hour of talk time capability and
24 hours of standby time. A smart card will also be available for IRIDIUM telephones.
The IRIDIUM system is expected to go into service in September 1998.
fefades/c
Backed by telecommunications pioneer Craig McCaw and Microsoft Chairman Bill Gates, the
Teledesic Network is scheduled to begin service in 2C02. It will provide two-way, broadband
connections for applications such as voice, data, videoconferencing and high-performance
Internet access.
A constellation of 840 satellites will orbit the planet at low, altitude, transmitting signals from any
point on the planet to any other with the speed of fiber optic cable.
EBT Processing Layer
The EBT processing Layer refers to a standard interface into the EBT processor for an EBT
program. This includes all pieces of a possible approach, especially in the areas of
communications protocols and message formats.
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Technical and Cost Feasibility Report Inventory & Analysis of Alt Technologies, Equipment & Vendors
Regardless of the technology utilized for the model wireless approach, it needs to interface into
the existing EBT processor infrastructure (i.e. Deluxe Data, Citibank, Transactive7,
Lockheed/Martin IMS) by utilizing existing standards. This means that the input of wireless EBT
transactions to the EBT processor should be based upon the X.25 or similar protocol and use
standard POS terminal message format standards (Visa I and II, ISO 8583).
Communications Medium
Although the wireless carrier options under consideration utilize a wide variety of standard and
exotic protocols and data transmission methods, it is necessary that the selected earner have
the capability to provide a leased-line interface to the EBT processor utilizing a standard
protocol such as X.25. This will allow the interfacing of wireless EBT POS terminals to be
completely transparent to the EBT processor. The interfacing of wireless POS credit card
transactions follow this same approach today with very little difficulty.
Message Formats
In addition to the requirement that the wireless earner interface in a standard method to the
EBT processor, the same is true of any potential POS terminal approaches. This means that
the POS terminal equipment should be able to produce EBT transaction messages (e.g.,
authorization requests, purchases, etc.) to the EBT processor in the standard format supported
for POS terminals by the EBT processor. Examples of this would be the Visa I and II formats
and ISO 8583.
7 GTECH, the parent company of Transactive, announced the sale of Transactive and its associated EBT contracts
to CitiCorp on February 27, 1998.
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Technical and Cost Feasibility Report Hypothetical EBT Approaches for Fanners' Markets
HYPOTHETICAL EBT APPROACHES FOR FARMERS MARKETS
The purpose of this section is to present several hypothetical EBT approaches for Farmers
Market Retailers and to compare high-level costs for those approaches.
APPROACH TO COSTING SURVEY
1. Multiple vendors were contacted and interviewee
2. Those interviewed included, Hypercom, Mondex, Omega Digital, Symbol Technologies
and Verifone.
3. Interviewees were assured that this was not a formal cost inquiry, rather an initial
feasibility study.
4. Costs and prices quoted were considered high-level, general and unofficial. These
prices are also approximate and subject to change based on volume purchases,
hardware and software changes, and other factors.
GENERAL CONFIGURATION ASSUMPTIONS
In order to investigate and identify suitable Farmers Market EBT POS approaches and compare
their costs, a number of common characteristics need to be established to apply to any
potential EBT POS approach. This means that any POS approach should:
1. Be as compatible as possible with on-line EBT systems now and in the near future (before
2002). The goal is for the POS terminal transactions to be delivered to the EBT processor in
a standard format (e.g., ISO 8583) and a standard communications protocol (e.g., X.25).
2. Be as vendor neutral as possible (i.e., not be specific to an EBT processor or utilize a
unique component accessible from a single vendor).
3. Be based upon a model farmers' market consisting of 20 retailers (for comparison
purposes).
4. Utilize the minimal amount of customized integration efforts necessary.
5. Be based upon costs for providing a working POS approach to EBT processor, but not for
passing a formal EBT certification process.
6. If a middleware application is necessary to provide an in-line bridge to a standard interface,
its costs should be minimized.
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Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers' Markets
APPROACHES CONSIDERED
Three approaches were analyzed for purposes of developing this high level costing analysis:
1. Sole Proprietor (including portable and desktop approaches)
2. Co-Op Model (wireless LAN)
3. Smart Card
THE SOLE PROPRIETOR APPROACH
With this approach, all necessary equipment is provided to the individual Fanners Market
Retailer so that the Retailer can individually accept food-stamp transactions as a stand-alone
merchant. Some of the basic configuration guidelines and requirements for this approach
include:
• Utilizing a terrestrial radio technology for wireless connectivity for performing on-line
authorizations. Because there is not a vast difference between data handling capacity of
the most common wireless techniques, any of the following are acceptable:
• ARDIS (was Motorola, now American Mobile Satellite Corp.).
• RAM Mobile Data.
• CDPD.
• Using either an integrated or separate PIN Pad, depending upon the sub-configuration
(portable or desktop).
• Using an Interface Layer consisting of an integrated modem or a connection to an external
cell-phone or other communications device.
• Consider price differentials between "Portable POS Terminal" and "Desktop PCS Terminal"
approaches.
Technical and Cost Feasibility of EBT Equipage Page 46
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Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers' Markets
Portabla Approach
The portable wireless POS approaches analyzed all had secure
PIN Pads, thermal printers, displays and batteries incorporated in
the base price. Certain models had additional serial ports that
could be employed for bar code readers or other devices, and
most units could read both magnetic stripe and integrated circuit
chip cards. The base offerings did not include spare batteries or
battery chargers, however, these are available for a nominal
price from the POS terminal hardware vendors.
Generally, the portable POS units without modem range in price
from $625 to $1,000 per unit, based upon the quantity of POS terminals purchased. This price
includes display, PIN pad, thermal printer and one battery. Additional batteries are $30-45 each
and the battery chargers cost $120-140. Both of these accessories are recommended, if not
mandatory.
The interface layer or modem is typically incorporated into the POS terminal by the hardware
vendor, and included in the overall POS terminal pricing quoted by the vendors. Vendors offer
three different types of communication protocols (e.g., CDPD, ARDIS, and RAM) by employing
different modems in the terminal. However, each has a slightly different cost structure. The
price of the wireless modem costs the POS terminal vendor in the $250 to $400 range, based
upon the wireless communications protocol employed. The POS terminal vendor then typi ally
has another $100 of cost to integrate the modem into the POS terminal (support hardware,
engineering, etc.).
Below is the table of costs for wireless POS terminals including the various modems. The
prices listed are for bundled approaches, that is, prices include all hardware and software minus
additional batteries and battery chargers. This can be seen visually in the summary diagrams at
the end of this section . The range in price generally reflects the cost differential if units are
purchased in bulk. For most vendors bulk pricing begins at 2,500 units.
Technical and Cost Feasibility of EBT Equipage
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Page 47
Tecfirecal era! Coat FeeefciMy Report Hypothetical EBT Approaches for Farmer*' Markets
Table 3 Range of Cost* for Portable Wireless POS Terminal*
Modem Type Cost Rang*
CDPD $1,100-51,400
ARDIS $875-$1,175
RAM $1,100-$1.300
Source: Technical and Coat FeastoMy of EBT Equipes* in Farmers' Markets and Moots Food Retaiers, Msy 19M.
Most terminal vendors can offer turn-key approaches and can sell bundled offerings. However,
often the vendors are not particularly well equipped or interested in providing for the POS
terminal software application. A software development company was contacted, that provides
the software applications for wireless POS approaches, to gain an estimate on what the scope
and cost of providing a wireless EBT approach would be. The vendor estimates are based
upon beginning the development of the software application from a functional specifications
document. An EBT processor document, which provides for the specifications of the standard
POS land-line EBT application, may be adequate for this purpose. If not, additional expense
would be incurred to develop the POS terminal EBT application functional specifications by
either the software vendor or a third party firm.
Representative cost for developing the POS terminal EBT software application are
approximately $64,000, plus or minus several thousand dollars, depending upon the complexity
of the EBT application.
Technical end Cost Feasibility of EBT Equipage Pege 46
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Technical and Cost FeesfoiNy Report Hypothetical EBT Approaches for Farmers' Markets
ei^^PvMftVp/ ^^£/p#FW1* 11
The desktop approaches were very similar to the portable
offerings from a price perspective. These devices include
magnetic stripe and integrated circuit chip card readers
(smartcard), displays, key pads (both integrated and stand-alone),
printers (again, both integrated and stand-alone) and
battery. Serial ports are available for printers and other devices
(such as bar code readers), and additional batteries and battery
chargers are also offered separately.
Typical non-wireless desktop PCS devices use standard
telephone lines for communication. In order to provide for a
low-end wireless approach, vendor offerings require an
additional communication module. This communication device
can convert standard dial frequencies out of the POS terminals to CDPD, and vice versa.
The low-end POS devices retail for roughly $350-$500 and the communication converter is an
additional $750 to $1,000. Newer generation remote POS devices combine both components
into one offering. These desktop POS devices retail for $1,000 to $1,500, depending upon
wireless modem (CDPD, RAM) and quantity purchased.
Additional batteries and a battery charger are recommended for the units. Batteries retail for
$30-45 each and the battery charger costs $120-140.
Technical and Cost Feasibility of EBT Equipage
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Page 49
Technical and Coal roarfiMy Raport Hypothetical EBT Approaches for Farmers' Markets
THE CO-OP MQPEl APPROACH
The Co-Op model is a group approach that is provided for all Retailers in the Farmers Market.
This approach allows individual retailers to accept electronic food-stamp transactions. Some of
the basic configuration characteristics of this approach are as follows:
a This configuration utilizes a controller/concentrator to provide wireless communications
access for multiple POS terminals to one or more land telephone line(s) in a shared fashion.
a The controller/concentrator needs to provide for a POS terminal environment for EFT
authorization messaging, multi-threading of transactions, queuing of transactions to
available lines, proper handling of time-outs and reversal handling, etc. which is compatible
with the Operating Rules of the EBT program.
• The configuration of the controller/concentrator for the Co-Op model consists of two
possible configurations, 1) a separate wireless LAN controller and separate POS controller
connected together by a RJ11 or RJ45 connection, and 2) a single integrated controller
which provides both wireless LAN and POS terminal controller functionality.
a The wireless connectivity from the POS terminals to the controller/concentrator can be
provided by licensed or unlicensed8 wireless communications techniques as long as the
maximum range of about 300 meters can be supported between the hand-held unit (POS
terminal) and the base-station (controller/concentrator).
• The POS terminal Interface Layer that provides wireless connectivity to the
controller/concentrator is either integrated into the terminal or is a separate, external,
ancillary module device.
Does not recjuire the MajM of a Icanae by the Federal Cormrmnicetions Commission to utilize the wireless
frequencies.
Technical and Cost Feasibility of EBT Equipage
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Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers Markets
• The POS terminal equipment can use an integrated or separate PIN Pad.
• The POS terminal equipment can utilize either a "Portable POS Terminal" or a "Desktop
POS Terminal" approach.
POS Terminal Equipment
The wireless LAN approach has two components: 1) the remote POS terminal and 2) the
controller/concentrator central dial device. The POS terminal is either a portable or desktop
device which merchants use to execute EBT transactions. The controller/concentrator receives
authorization queries from the POS terminal and routes them to the processor over standard
dial telephone lines.
The POS terminal typically has all the functionality of a portable or desktop POS device. That
is, it has a secure PIN pad, thermal printer, battery and display, either integrated or as separate
units. It is also capable of being configured to handle both magnetic stripe and integrated
circuit cards. Each controller/concentrator can typically handle 32 or more POS terminals.
POS terminals retail in the range of $710 to $850 per unit and the controller/concentrator retails
for $550 to $650. The controller/concentrator can also be retrofitted with a high powered
antenna for an additional $50. This allows the terminals additional range.
Additional batteries and a battery charger are recommended for the units. Batteries retail for
$30-45 each and the battery charger costs $120-140. Most terminals utilize a single nickel-cadmium
battery
With respect to the controller/concentrator, the devices that we reviewed for this study typically
support only one J11 dial telephone line port. This means that in order to get performance that
is within the guidelines established in the EBT Operating Rules, from the perspective of POS
terminal authorization response times, it may be necessary for the controller/concentrator to
"multi-thread" outbound and incoming authorization messages over that single telephone line.
Otherwise, the more wireless POS terminals that are supported by a single
controller/concentrator, the longer the authorization response delays will tend to be, and the
Technical and Cost Feasibility of EBT Equipage Page 51
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Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers Markets
greater the likelihood that the EBT authorization response times from these wireless POS units
wiN exceed the guidelines. The rational for this is:
1. 'Multi-threading' is when POS terminal transactions from multiple POS terminals are allowed
to be interleaved on a single communications line at the same time with other POS terminal
transactions. Multi-threading allows EBT authorization requests to occur simultaneously
with other POS terminals because it interleaves messages from multiple messages over the
line, and is able to redirect responses back to the originating POS terminals.
2. 'Single-threading' is when only one POS terminal transaction can utilize the
controller/concentrator telephone line connection to the EBT Processor at a time. Single-threading
allows only one EBT authorization request / response to be sent and received with
an EBT Processor before the next EBT authorization request from a POS terminal can be
sent and received with the EBT Processor.
Because multiple POS terminals can be in the process of performing transactions at any given
time, the controller/concentrator needs to be able to route the proper response message from
the EBT processor to the correct POS terminal. This is generally accomplished by putting a
unique electronic identification lag' on the outbound message to identify the POS terminal who
originated the message. This tag is then returned in the authorization response by the EBT
processor to the controller/concentrator. The controller/concentrator utilizes this tag to know
which POS terminal to send the response back to. The visa II message set does not support
message tags as a standard as does the ISO 8583 message set. None of the current major
EBT processors (Citibank, Transactive, Deluxe) are known to provide a Visa I! or ISO 8583
EBT message set that supports electronic message tagging.
Vendors who manufacture the controller/concentrators do not typically support multi-threading
as a standard feature in their current offerings. However, multi-threading can be supported by
the vendor with additional software enhancements to the controller/concentrator. However,
because of the expense to do this, a more cost-effective approach may be to limit the number
of wireless POS terminals connected to each controller/concentrator.
Technical and Cost Feasibility of EBT Equipage Page 52
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Technical and Coat Feasibly Report Hypothetical EBT Approaches for Farmers Markets
Because of limited EBT Processor support for multi-threading EBT POS terminals, significant
work and investment will likely be needed for EBT Processors to support multi-threading
(estimates are 3 months of software work at a cost exceeding $50K).
POS Terminal Controllf/Concfitrator Equipment
The wireless POS terminal controller/concentrator equipment is provided by manufacturers in
two different possible configuration options. The controller provides EFT messaging logic for
routing POS terminal transactions to and from the EBT processor. The concentrator provides
for communications with the wireless POS terminals and with a common telephone line. There
are two types of configurations for this equipment as described below:
1. Discrete
For this configuration, the controller is a unique piece of equipment, and the concentrator is
also a unique piece of equipment. These two devices are connected together by some sort
of cable (e.g., serial or LAN), and work together, each performing its individual task. An
example of this type of configuration is the Verifone Transceiver Concentrator and the 1200C
Controller.
2. Integrated
With this configuration, the controller and concentrator are integrated into one device. An
example of this type of device is the OmegaBEACON RF Terminal LAN Controller.
The pros of an integrated controller/concentrator are that it is simple, easy to set-up and use,
and perhaps most importantly, less expensive. The con is that you have to accept that the POS
terminal (capabilities, functionality, application software language, etc.) of the integrated
approach may be inferior to a highly standard POS terminal like a Verifone Omni 380. The pros
of a discrete approach are that you can mix common, popular POS terminals (e.g.,. Verifone
Omni 380) with the concentrator and therefore have commonality with your landline POS
terminals. The con is that it is more expensive, and it is more cumbersome to set-up and
support.
Because quality integrated devices are readily available, and tend to be less expensive than
discreet controllers and concentrators, the integrated device should be considered to be the
Technical and Coat Feasibility of EBT Equipage Page 53
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Technical and Coat Feasibility Report Hypothetical EBT Approaches for Farmers Markets
appropriate type of unit for a Co-op Farmers Market. Furthermore, vendors seem to be
phasing out discreet component configurations of controller/concentrator devices.
THE HYBRID SMART CARD READER/PRINTER/PIN PAD MODEL APPROACH
The Hybrid Smart Card Reader/Pnnter/PIN Pad POS terminal is equipped to be able to provide
each farmer with the capability to perform both on-line and off-line authorizations and the
uploading of stored-vaiue transactions on a regular land-line based telephone line. Some of the
configuration requirer nts for this approach are:
• The Hybrid Smart Card terminal needs to be able to read a chip card, and support an EBT
stored-value application.
• This approach needs to be able to dial an EBT processor on a standard telephone line to
perform authorizations and to upload stored-value transactions.
• The Hybrid Smart Card terminal needs to be able to print a receipt.
• The Hybrid Smart Card terminal needs to be able to support a PIN Pad and perform PIN
validation against either the PIN stored in encrypted format on the smart card, or at the EBT
processor (mag-stripe).
Smart Card Approach - Terminal Equipment
Any of the three proceeding modules (portable, desktop or wireless LAN) can also
accommodate smart card readers as a standard product option by retrofitting the base units to
accept smart cards.
In order to accept IC cards based upon open standards (Visa Cash, Mondex, Proton), a PSAM
drawer needs to be added to the terminal. The addition of the PSAM drawer costs
approximately $200. The PSAM drawer can accommodate up top five different cards, each
card representing a different smart card platform. Apart from the hardware cost for the drawer,
each PSAM card costs roughly $10.
The advantage of having multiple PSAM capability is that the merchant can accept multiple
smart i J systems (Mondex, visa Cash, Proton, etc.) in addition to debit and credit cards. If
the EBT program in which the Farmers' Market operates was a closed environment, multiple
Technical and Cost Feasibility of EBT Equipage Page 54
in Farmers Markets and Mobile Food Retailers
Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers Markets
PSAM capability is not needed. In this case, the average, single platform smart card POS
terminal without the multiple PSAM capability cost under $500. This unit would have printer's,
pin pad, and display incorporated. This option is not a hybrid terminal, meaning that only the
government issued smart cards would be accepted and not credit or debit cards. Software
costs are dependent on the application and platform chosen.
Smart Card Approach - EBT Processor
The EBT Processor needs to be able to support the EBT stored-value software application
whose functionality includes:
a Downloading benefits to cards monthly (provided with ATMs).
• Uploading purchases from the Hybrid Smart Card terminal from retailers daily.
• Reconciliation of downloaded benefits to uploaded transactions daily.
a Support for balance inquiry functions for the card (at ATMs and POS terminals).
The EBT processor can support the stored value application either as an integrated component
of their core-processing platform, or as a stand-beside platform with some degree of integration
to their core-processing platform.
COMMUNICATION COSTS
Depending on which type of communication protocol is employed, the price per average
transaction varies in the wireless environment. Below is a table outlining the different cost
structures for analog and digital cellular communications.
Table 4 Cost Structure of Anal
Nunil
Digital Cellular Communications
-* ~ ■-iry^-
(penminute*^
ST"
iafc-.IL i
Source: The Yankee Group. PC Weak. December 8,1997
Mi ,
Technical and Cost Feasibility of EBT Equipage
in Farmers Markets and Mobile Food Retailers
Page 55
Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers Markets
Average on-line time has been estimated at five to six seconds per transaction. Those figures
equate to communication costs of approximately 5tf to 6< a transaction for an analog based
cellular system with a merchant averaging less than 60 total airtime minutes a month.
However, as of now, analog earners charge in a minimum of 30-second intervals, making
analog unattractive. Digital is now beginning to charge in smaller intervals, but these providers
are concentrating on the more lucrative voice services in the large metropolitan areas, and have
had little time (digital was only introduced in 1995) to concentrate on expanding and marketing
data services.
The CDPD option might be more attractive; it costs between 3£ to 6« per transaction, based
upon several factors:
• Time of Day
• "Premium" is during the day, and is more expensive.
• "Non-Premium" is off-hours (night) and is less expensive.
• Volume
• Pricing is at the merchant level by the carrier, but billing is at the processor level.
• It is unusual that CDPD merchants use up the mandatory base allotment of data
that they get for the flat $12 fee that they pay.
Beyond allotment of a flat $12 fee for data, pricing is 6# to Q<t per 1,000 bytes of data
transmitted.
Also, RAM costs approximately 5£ a transaction according to vendors surveyed. Costing
information for ARDIS was not available
Technical and Cost Feasibility of EBT Equipage Page 56
in Farmers Markets and Mobile Food Retailers
Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers' Markets
SUMMARY OF APPROACHES
Soto Proprtotor-Fortabto Approach
1.
TOseo«*MMMr
2.
AMBflvM Luyir ^ r
3.
Cantor ^ r
4.
EBT
Source: Technical and Cost fiaaftiety of EBT Equipage in Farmavs' Markets and Mobile Food Ratailare. May 1998.
Technical and Cost Feasibility of EBT Equipage
in Farmers Markets and Mobile Food Retailers
Page 57
Technical and Cost Feasibility Report Hypothetical EBT Approaches for Farmers' Markets
Sote Proortotor-O—ktop Approach
1.
.A.
POS Equipmmt ~\ r //?HmKr# LJrJrW
A r Carriar EBT
4.
-A.
gas MW —roe s78Mi.au—tae—aa— H*ti m. — CDPD
E^waBflaCtTl COBVtJfttT
SJS-S4S — SaarcBMMry QfM. ■■<»■) S*/tr*. —RAM
V«Aff*cmUe»Su.-~r
<>
S12S-S14S —
I
Souroe: Technical and Cost Feasibility of EBT Equipaoa in Farmers' Markets and Mobtta Food RataOari. May 1998.
Technicai and Cost Feasibility of EBT Equipage
in Fanners' Maisets and Mobile Food Retailers
Page 58
Technical and Coat Feanbikty Report Hypothetical EBT Approaches for Farmers' Markets
CO-OP Modrt-WIwi—S LAN
1.
POS equipment Intwfwc* Lsytr vMraraas Cflfltaf
*
DwMop Co»?ffyur«ltofi
S 9
ilOirti
S71MN —POS
OS-MS — Spare Beuarr
SI2S414S
lamtUmOmwm
■** AffMcmHt» Sarvty
Source: Technical and Cost Feasibility of EBT Equipage in Farmers' Markets and Mobile Food Retailers. May 1998.
Technical and Cost Feasibility of EBT Equipage
in Farmers' Markets and Mobile Food Retailers
Page 59
Technical and Cost Feasibility Report Potential Impacts of New Technology
POTENTIAL IMPACTS OF NEW TECHNOLOGY
Introduction
This Chapter presents the study findings on the potential impacts new technology will have on
government, EBT operators, and farmers' markets and mobile food retailers. The chapter
contains anecdotal information from informal interviews with EBT stakeholders. We begin this
section by explaining the interview methodology and the types of questions that were
addressed, how we collected the information, and then presenting the potential impacts
grouped into conceptual, operational, organizational and budgetary categories.
Methodology
Informal interviews of EBT stakeholders representing federal government staff, State agency
staff, fanners' market and other mobile food retailers, EBT operators, and FSP advocacy
groups were employed to document the range of issues that may have an impact on
government, EBT operators, and farmers' markets and mobile food retailers.
As preparation for the conduct of stakeholder interviews, a synopsis of the Technology
Inventory chapters of this report (Chapters 1 through 4) was prepared and distributed to all of
the stakeholders. The interviews were conducted during November and December 1997 and
consisted of 21 interviews with individuals who represented a cross section of EBT stakeholders
of divergent interests including:
Federal Agency EBT representatives (3)
EBT system operators with current contracts with states (5)
FSP Advocacy Groups (3)
State Agency representatives (6)
Farmers' Market retailers (4)
Technical and Cost Feasibility of EBT Equipage Page 60
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Technical and Cost Feasibility Report Potential Impacts of New Technology
The following informal interview protocol was used by the interview team to guide »he interview
process:
Our overall requirement for the stakeholder interviews is to determine what impacts will new
technology (i.e. the alternatives we have presented in our Technology Inventory Report) have
on:
Government (Federal and State)
EBT Operators (Processors and Third Parties)
Food Retailers (Farmers, Mobile merchants, Farmers Market Managers)
The kinds of questions we should be asking start with their assessment of the technology
alternatives that we have come up with:
Are there technologies that we have missed?
Have we expressed all the alternatives for the technologies presented?
Are there other farmers' market models?
What is their opinion of the alternatives presented?
Which alternatives are the most promising from their point of view? Why?
Which alternatives are the least promising from their point of view? Why?
We should follow the above questions with some discussion of how the implementation of
these alternatives:
Would affect their business (admin., technical, and cost)?
Would affect their customers(admin., technical, and cost)?
Would affect other parties (ad mm., technical, and cost)?
Finally, we should determine if thev have any efforts (startup or on-going) to either implement or
begin research on implementing wireless EBT technology for their customers.
Source: Technical and Cost Feasib'Wy of EBT Equipage in Farmers' Markets and Mobile Food Retailers, May 1998
This interview protocol was not meant to be a structured interview guide, but rather a list of
topics to be covered and confirmed during the interview with questions directed to appropriate
respondents. This exploratory approach is especially valuable for a study of a relatively
unknown and technical subject. To the extent that documents and records were not available,
interviewees were asked to provide their best judgment of the information requested.
This study is not controlled, hypothesis testing research. Rather, mostly qualitative and some
quantitative data on a rich array of factors are to be woven together into