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August 2005 • Volume 10 Number 8
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Member Profile: Hitachi Smart Solutions
In June 2001 Mullaney Publishing Group published Get Smart, Chuck's book on the emergence of smart cards in the United States and their pivotal role in electronic commerce. Chuck also holds two smart card patents for the healthcare industry. Chuck received his BA and MA degrees from The Ohio State University, and his MBA from Memphis State University. He is a member of the International Executives' Guild, and a board member of the Smart Card Alliance. 1. What are Hitachi's main business profile and offerings? Hitachi America, Ltd. is a wholly owned subsidiary of Hitachi, Ltd., an $84.4 billion dollar company with approximately 347,000 employees around the world. Hitachi America, Ltd. markets and manufactures a broad range of electronics, computer systems and products, consumer electronics, and provides industrial equipment and services throughout North America. Hitachi, Ltd. is one of the world's largest global electronics and electrical companies, and offers a wide range of systems, products and services in market sectors including information systems, electronic devices, power and industrial systems, consumer products, materials and financial services. Hitachi Smart Solutions is the group within Hitachi America responsible for smart card and RFID solutions. Hitachi Smart Solutions is a systems integrator as well as a smart chip consultancy. As a key initiative within Hitachi America, Hitachi Smart Solutions provides a broad portfolio of technology solutions in selected market sectors. 2. What role does smart card technology play in supporting Hitachi's business? The manufacturing of integrated circuit chips as well as RFID chips are major businesses for Hitachi, Ltd. Hitachi Smart Solutions supports these core businesses by assisting organizations in integrating smart chip and RFID technologies into their normal business processes. As a systems integrator Hitachi Smart Solutions provides project management / quality assurance services, system design, software development, and professional support services. From chip design to system development to system installation, Hitachi Smart Solutions applies smart chip technology to provide its customers with a total solution. Smart cards and RFID tags are enabling tools that allow new products and services to reach extended markets. These technologies are used to reward customer loyalty, increase shopper convenience, reduce costs, and streamline many tedious tasks in our daily lives. They help provide us with information security, portability of key data, better organization, greater audit ability, reduced fraud, extended data storage, off-line freedom with on-line approval, end-user only accessibility, expense control, and convenience. Growing smart chip usage is altering the traditional database, networking and processing capabilities with which we are currently familiar, and it is expected to usher in a new era of personal data management and control. We support a wide array of smart chip applications from basic systems to custom application development. Our primary vertical market focus is in the following areas:
3. What trends do you see developing in the market that Hitachi hopes to capitalize on? From Hitachi's perspective, we see the following trends developing in the market:
4. What obstacles to growth do you see that must be overcome to capitalize on these opportunities? There are two key obstacles: (1) the entrenched magnetic-stripe infrastructure remains a low-cost alternative that sometimes attracts and side-tracks applications best supported by a smart chip; and (2) the lack of true interoperability among vendor systems. The appeal in using cheap magnetic stripe cards for applications in the U.S. market will slowly erode as the benefits of smart chips are fully realized and as magnetic stripe cards are further compromised by fraudsters. Additionally, the cost structure associated with smart chip-based solutions continues to drop, and they are becoming very affordable. Interoperability will continue its relentless march with additional standards emerging and by embracing other existing standards (e.g., TCP/IP, USB, etc.). 5. What do you see are the key factors driving smart card technology in the market? The business case in the United States will be tied to multiple applications and shared costs for infrastructure development. There is no single killer application in the United States - a market renowned for its broad, diverse and boundless opportunities. Smart card deployment will mirror that diversity. Many applications are finding success in the U.S.; and they will co-mingle, overlap, interweave, and prosper. We are still in the early stages of retooling the existing infrastructure to accommodate smart chip technology. Broad acceptance of smart cards in the United States will be highly correlated to the infrastructure support of this fledging industry. The drivers of smart chips, in various form factors, are the combined need for heightened security, digital identity verification (including biometrics), portable database management, loyalty, transit and i-commerce. Smart card technology represents a new way to conduct business and new opportunities to differentiate services. 6. How do you see your involvement in the Alliance helping Hitachi become successful? The Smart Card Alliance (SCA) has done an excellent job of increasing awareness of smart cards and their potential. They are the key organization in the U.S. that educates businesses and government agencies regarding the benefits of smart chip technology. It is a non-profit organization comprised of diverse organizations, all working for a common goal in promoting smart cards. Hitachi is proud to be included among the companies actively participating in the SCA, and is committed to fostering information exchange regarding this exciting technology. SCA brings together an array of organizations across North America to grapple with issues common to the industry. It provides opportunities to extend industry contacts through participation in collaborative projects and to acquire a broader perspective through contact with other industry players. Thus, participation in the SCA increases Hitachi's understanding of industry trends, introduces it to different perspectives, and extends its ability to influence solutions to common problems faced by all industry stakeholders.
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This month Smart Card Talk spoke with Chuck Wilson, Senior Director of Hitachi Smart Solutions division. Chuck has been in the card processing industry for over 20 years, and has been researching and writing about smart cards for the past eight years. Chuck spent 12 years with Electronic Data Systems (EDS) where he was a Payment Services Division vice president directing the global delivery of POS and commercial card processing. Chuck was a senior vice president of CardSystems Solutions Inc. in Addison, Texas where he led the product development of emerging payment products. As the Senior Director of Hitachi Smart Solutions division for the past three years, Chuck establishes and guides systems integration strategies, and directs the project management of each customer initiative. 