Error 87 always means that your Authorize.Net account is not set up to properly accept Card Not Present (aka MOTO) transactions. To start using Swipe, contact Authorize.Net and tell them that you are trying to set up Swipe and you're getting error 87. It's a simple change on their end and you'll be up and running in no time!

Response Reason Code: 87

Response Reason Text: Transactions of this market type cannot be processed on this system.

Integration Team Suggestions: This can happen for four reasons:
1) You are attempting to process a type of transaction that your account is not designed for. An example would be using a card swipe machine to process transactions on an e-commerce or mail order/telephone order (MOTO) account. 
2) You are passing an incorrect value to x_market_type. If you are using a Retail account you want to pass a 2. The Implementation Guide for card present transactions can be found at http://www.authorize.net/support/CP_guide.pdf. 
3) Your merchant service provider may be incorrectly setup for this account. 
4) The product type (SIC code) is incorrect for this account.