Magnetic-Stripe Cards: The Consolidating Force

Magnetic-Stripe Cards: The Consolidating Force

Katina Michael (University of Wollongong, Australia) and M.G. Michael (University of Wollongong, Australia)
DOI: 10.4018/978-1-59904-795-9.ch006
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Abstract

Almost simultaneously that the retail industry underwent revolutionary changes with the introduction of bar code, the financial industry adopted magnetic-stripe card technology. What is of interest is that both bar code and magnetic-stripe card enjoyed limited exposure when they were first introduced in the late 1960s. It took at least a decade for the technologies to become widespread. Each overcame a variety of obstacles. Coupled together the two techniques were major innovations that affected the way that consumers carried out their day-to-day tasks. The technologies were complementary; on the one hand were the actual commodities consumers purchased and on the other was the means with which they purchased them. Yet, the bar code differed from magnetic-stripe card in that it was more a service offered by retailers to consumers, with the primary focus being to make business back-end operations more efficient. The magnetic-stripe card however, had a more direct and personal impact on the cardholder, as it was the individual’s responsibility to maintain it. The consumer had to carry it, use it appropriately, and was liable for it in every way. Certainly bar codes on cards were being used early on but they were far less secure than magnetic stripe cards and therefore not adopted by financial institutions. Before too long, magnetic-stripe cards became synonymous with the withdrawal of cash and the use of credit which acted to heighten the importance of the auto-ID technology. Even today, magnetic-stripe cards for financial transaction cards dominate the market.
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Magnetic-Stripe Card Technology

Almost simultaneously that the retail industry underwent revolutionary changes with the introduction of bar code, the financial industry adopted magnetic-stripe card technology. What is of interest is that both bar code and magnetic-stripe card enjoyed limited exposure when they were first introduced in the late 1960s. It took at least a decade for the technologies to become widespread. Each overcame a variety of obstacles. Coupled together the two techniques were major innovations that affected the way that consumers carried out their day-to-day tasks. The technologies were complementary; on the one hand were the actual commodities consumers purchased and on the other was the means with which they purchased them. Yet, the bar code differed from magnetic-stripe card in that it was more a service offered by retailers to consumers, with the primary focus being to make business back-end operations more efficient. The magnetic-stripe card however, had a more direct and personal impact on the cardholder, as it was the individual’s responsibility to maintain it. The consumer had to carry it, use it appropriately, and was liable for it in every way. Certainly bar codes on cards were being used early on but they were far less secure than magnetic stripe cards and therefore not adopted by financial institutions. Before too long, magnetic-stripe cards became synonymous with the withdrawal of cash and the use of credit which acted to heighten the importance of the auto-ID technology. Even today, magnetic-stripe cards for financial transaction cards dominate the market.

Complete Chapter List

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Dedication
Table of Contents
Foreword
Elaine Lawrence
Acknowledgment
Katina Michael, M.G. Michael
Chapter 1
Introduction  (pages 1-24)
Katina Michael, M.G. Michael
This study is concerned with the automatic identification (auto-ID) industry which first came to prominence in the early 1970s. Auto-ID belongs to... Sample PDF
Introduction
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Chapter 2
Innovation Studies  (pages 25-42)
Katina Michael, M.G. Michael
This chapter will explore literature in the field of innovation in order to establish a conceptual framework for the auto-ID trajectory research.... Sample PDF
Innovation Studies
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Chapter 3
Katina Michael, M.G. Michael
This chapter takes the reader through a historical tour of identification techniques from ancient times to the present. The histories shed light on... Sample PDF
Historical Background: From Manual Identification to Auto-ID
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Chapter 4
Katina Michael, M.G. Michael
National security measures can be defined as those technical and non-technical measures that have been initiated as a means to curb breaches in... Sample PDF
Globalization and the Changing Face of IDentification
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Chapter 5
Katina Michael, M.G. Michael
Of all the auto-ID technologies in the global market today, barcode is the most widely used. In 1994, Cohen (p. 55) wrote “...barcode technology is... Sample PDF
Barcode: The Pioneer Auto-ID Technology
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Chapter 6
Katina Michael, M.G. Michael
Almost simultaneously that the retail industry underwent revolutionary changes with the introduction of bar code, the financial industry adopted... Sample PDF
Magnetic-Stripe Cards: The Consolidating Force
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Chapter 7
Katina Michael, M.G. Michael
The history of the smart card begins as far back as 1968. By that time magnetic-stripe cards while not widespread, had been introduced into the... Sample PDF
Smart Cards: The Next Generation
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Chapter 8
Katina Michael, M.G. Michael
Biometrics is not only considered a more secure way to identify an individual but also a more convenient technique whereby the individual does not... Sample PDF
Biometrics: In Search of a Foolproof Solution
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Chapter 9
Katina Michael, M.G. Michael
Radio frequency identification (RFID) in the form of tags or transponders is a means of auto-ID that can be used for tracking and monitoring... Sample PDF
RFID Tags and Transponders: The New Kid on the Block
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Chapter 10
Katina Michael, M.G. Michael
This chapter analyses the findings from the case studies on bar codes, magnetic-stripe cards, smart cards, biometrics and RFID tags and... Sample PDF
The Auto-ID Technology System
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Chapter 11
Katina Michael, M.G. Michael
This chapter is about geographic information systems (GIS) and its relevance to the location-based services industry. One might initially ask how... Sample PDF
Geographic Information Systems & Location-Based Services
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Chapter 12
The Auto-ID Trajectory  (pages 329-363)
Katina Michael, M.G. Michael
This chapter considers the automatic identification (auto-ID) trajectory within the context of converging disciplines to predict the realm of likely... Sample PDF
The Auto-ID Trajectory
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Chapter 13
Katina Michael, M.G. Michael
The number of automatic identification (auto-ID) technologies being utilized in eBusiness applications is growing rapidly. With an increasing trend... Sample PDF
The Socio-Ethical Implications of Automatic Identification and Location Services
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Chapter 14
Katina Michael, M.G. Michael
When Jacques Ellul (1964, p. 432) predicted the use of “electronic banks” in his book, The Technological Society, he was not referring to the... Sample PDF
The Rise of the Electrophorus
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Chapter 15
Uberveillance  (pages 464-484)
Katina Michael, M.G. Michael
Uberveillance, also überveillance, is an above and beyond, an exaggerated, an almost omnipresent 24/7 electronic surveillance. It is a surveillance... Sample PDF
Uberveillance
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Chapter 16
Conclusion  (pages 485-496)
Katina Michael, M.G. Michael
This chapter is dedicated to identifying the main outcomes of the study and reflections on the future directions of the technologies that were under... Sample PDF
Conclusion
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Acronyms and Abbreviations
About the Contributors