Exposing the Coinstar Network

by area_51

Located across the United States, and now in parts of the United Kingdom and Canada, Coinstar machines are situated in supermarkets everywhere.

Large and green (in the U.S. - blue in foreign markets), the machines accept unrolled, unsorted change and spit out a voucher redeemable for cash for a processing fee.  While the concept is simple, Coinstar has more to it than meets the eye.  As a previous investor in the company and a frequent user of their machines, I have learned a great deal about how they work.

The machine itself consists of a CRT monitor, receipt printer, two large plastic bins which hold change, a mechanism for sorting change, a modem, and (surprisingly) a telephone.  The machine is controlled by four large buttons, one green, one red, and two gray (newer machines have slightly different configurations).  The user presses the green button several times to enter into the coin processing mode, at which point they dump their change into a metal tray.  The change falls through a small slot, where it drops down into the sorting mechanism.  If too much is change is dropping into the sorting mechanism, the slot closes temporarily to allow the sorting mechanism to catch up.

The sorting mechanism itself does not involve the size or the weight of the coin, as this is too slow a process and causes too many errors in the identification of coins.  Rather a complicated process involving electromagnetic identification is used.  Coinstar currently holds U.S. Patent Number 6,196,371 for the device and the abstract of the patent provides a good explanation of how it works:

A coin discrimination apparatus and method is provided.

Coins, preferably after cleaning, e.g. using a trommel, are singulated by a coin pickup assembly configured to reduce jamming.  A coin rail assists in providing separation between coins as they travel past a sensor.  The sensor provides an oscillating electromagnetic field generated on a single sensing core.  The oscillating electromagnetic field is composed of one or more frequency components.  The electromagnetic field interacts with a coin, and these interactions are moninored and used to classify the coin according to its physical properties.  All frequency components of the magnetic field are phase-locked to a common reference frequency.  The phase relationships between the various frequencies are fixed, and the interaction of each frequency component with the coin can be accurately determined without the need for complicated electrical filters.

In one embodiment, a sensor having a core, preferably ferrite, which is curved, such as in a U-shape or in the shape of a section of a torus, and defining a gap, is provided with a wire winding for excitation and/or detection.  The sensor can be used for simultaneously obtaining data relating to two or more parameters of a coin or other object, such as size and conductivity of the object.  Two or more frequencies can be used to sense core and/or cladding properties.  Objects recognized as acceptable coins, using the sensor data, are diverted by a controllable deflecting door, to tubes for delivery to acceptable coin bins.

Prior to entering the actual sorting mechanism, the coins are run through a process which sorts out any debris, including washers, paperclips, and anything else that might be in a jar of coins.  These objects fall into a plastic tray above the sorting mechanism, and are not returned to the user.

The coins then fall into one of two bins: an all-pennies bin (pennies make up much of Coinstar's business) and a bin for the rest of the coins.  In actuality, the coins must be taken by armored car to another sorting facility where they must be sorted once again, as a treasury requirement.

When the process completes, a receipt is spit out of the receipt printer, with several security features:

• The Coinstar logo is displayed on the right and left side of the tape when held under ultraviolet light.
• On the rear of the receipt, there is a small box with nothing in it.

If a coin is rubbed across the box, the Coinstar logo appears.

However, far more interesting than the actual machine is the Coinstar network.

Each machine contains a modem and a phone.  Each machine dials the Coinstar headquarters every night and downloads the day's usage statistics.  These include the number of coins counted, what types of coins were counted, the number of transactions, the average dollar amount per transaction, and the reject percentage (used in determining if a machine is rejecting an excessive amount of coins, which is cause for a technician to be sent out to examine it).

A normal reject percentage is around one percent, however slightly higher percentages may be simply due to people inserting all kinds of foreign matter into the machines.

In addition, the machine analyzes the last week's worth of usage statistics, and estimates the day it will be full.  An armored car will then be scheduled to empty the machine on that day, or possibly earlier.  The machines also contain diagnostic software that will automatically page a technician if a problem occurs.

Occasionally, Coinstar sends software updates to the machines to fix bugs, add features, and advertise promotions.  These updates are also downloaded to the machines during this time period.

All of these statistics are stored on servers at Coinstar's headquarters in Bellevue, Washington, and many employees can access them over the network through software loaded on their computers.  I received a tour of the headquarters several years ago, and at the time all the servers were running Windows NT 4.0.

I did notice another interesting feature while at Coinstar headquarters.  They had a row of machines, dating from the earliest machine through their future models that had not yet been released.  Some machines were on and functioning, others were off.

However, one (a current model) displayed a "Press CTRL+ALT+DEL to log on" message, as commonly seen in Windows NT 3.x and 4.0  For this reason, I have a suspicion that the machines run some form of Windows in the background, or at least have the capability to do so.

In addition, the machines contain a phone that is linked directly into the Coinstar network.  If a store employee needs to schedule maintenance, check the next coin pickup, or do any number of other things, he just needs to open the machine (it is locked with a key) and pick up the phone.  Also, when the machine is opened, a PIN code must be entered to obtain access to the diagnostic software, statistics, and to change the options of the machine.

This code is also needed to access the phone.  I personally have not had the opportunity to access this part of the machine, mainly due to the lock and the security cameras right next to it (however, the lock is the main obstacle).

For all its ease of use, a lot of technology sits behind the green plastic of a Coinstar machine, much of which I still have yet to uncover.