ARLINGTON, Va. – Does the recent announcement that Cardtronics will buy E*Trade's portfolio of ATM machines mean trouble ahead for Allpoint, the upstart ATM network that has collected numerous credit union clients over the last year? On the surface it might seem so. With their 12,000 and 15,000 ATMs, respectively, Cardtronics and E*Trade formed the backbone of nationwide ATM machines that Allpoint has offered, surcharge free, to credit union cardholders whose institutions paid a flat fee. Now, with only one ATM deployer, what is to prevent Cardtronics from merely approaching banks and credit unions and directly offering the very same access on much the same terms? “Not going to happen,” said Ben Psillas, CEO of Allpoint, “we have too good a relationship with Cardtronics and one that benefits both our companies for that to happen.” “Frankly, they [Cardtronics] have a lot on their plate administering and growing their ATM network,” Psillas noted, “while in their relationship with us they have easier access to card issuers willing to provide a regular revenue stream. We see our relationship with Cardtronics only growing stronger in the years ahead.” The majority of Allpoint's roughly 80 client financial institutions are credit unions. For its part, Cardtronics, which filed with the Securities and Exchange Commission on March 10 for its Initial Public Offering of stock, has remained quiet about the pending purchase and what it might mean for Allpoint. “Under the terms of our stock offering we are in our quiet period and can't make any comments about any of our operations,” said Westley Horton, vice president of marketing for Cardtronics. Horton did confirm, however, that Cardtronics' ATM purchase was not going to require any regulatory approval and that it would go forward as soon as the legal and financial documents could be prepared. But Tony Hayes, managing director for Boston-based Dove Consulting and a recognized ATM expert, wondered if the temptation to cut Allpoint out of the deal might prove irresistible for Cardtronics. “Here they are, they have the machines and if they can get entry into the credit unions themselves, why have a middle man,” Hayes asked. “At the very least it may result in Cardtronics having more of a competitive advantage over Allpoint,” Hayes added. -

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