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The rub with this stock is that it goes against most investing caveats you can come up with. Trust, faith and belief are all that have caused many to hold onto this stock for so many years. One look at the financial statement backs this up, and thats why traders have made so much cash off this stock over the years. They could care less about the steady rise and have caught plenty of 20% or more moves over the years. I watch Cramer on CNBC when I can and read his latest book- looks like I am not in a minority here with the book's and his show's numbers-and even by his metrics this stock is a cunundrum. On one hand you could read that he would not touch this baby with a ten foot pole. But then you read his criteria for a speculative stock where the big movers come from and this seems to be right up his alley. This paradox seems to be why the tenor of the board flucctuates so much.
Dave
Snackman, in the big picture what happens in the 3rd quarter is irrelevant. The same goes for the 4th quarter. Wave needs the deals they have in place to start bearing fruit. They need tangible dollar figure to appear in any deal bearing PR's released so the street can extrapolate some sort of figure going out so value can be derived ....... you know the drill. The critical time is approaching next year for this company and it has nothing to do with finances, as we have seen they seem to find a way to procure cash in trying circumstance. The acceptance of trusted computing and security by the manufacturers and consumers are the next driver. Wave I don't think can survive by being a niche product being dependant upon others to bring it's products to the consumer. This company is on the verge of being a thriving market leader by this time next year, or failing entity disappearing from the landscape. I've bet on the former, that's why I am still here, but it isn't a done deal in my mind till we start seeing PR's with a $ figure attached to them with regularity.
Dave
Rachel that's what I meant.
I meant Q3 and Q4 in place of 2 and 3. At this stage nothing surprises me anymore.
Dave
The runway dosen't get longer Go. At this point it can't. What we have seen in the past 18 months is the kernel of an idea turned into a product and now it is turned into a product wanted by the producers, with an education an eventually a wanting by the consumer. The wanting by producers phase is over, Dell signaled that. We seem to be in the education phase now given the number of articles and information on Trusted Computing and the TCG etc. that you can seek out rather easily. No, Wave's runway can't keep getting longer that's for sure. When the demand is there if they can't deliver somebody else will. That demand should start to surface in a big way within the next 8 months on out. If anything, the runway gets shorter from here on out. If they are the Nuts, then who needs a runway?
Dave
19 days under a buck.
Amidst all the seemingly good developements we have seen and the shareprice languishes in the .80's despite very real connections to Intel, Dell, Gateway et al. The quarter has passed and the stock seems to trade lower every day. FWIW I think the 2nd quarter revs will be lower than the first. Why do I think this is the case? I think the confusion and difficulty of finding the software from our resellers without a SKU hasn't helped. Gateway IMO still hasn't sold anything in numbers of consequence. I called them last week and spoke to a rep directly that I was looking for equipment for a small business that had no inkling of what the TPM was, but he would e-mail me directly with the info when he gets it. This dosen't mean this is vaporware for Gateway by anymeans, it is still in it's infancy there. I have personally checked with some of the PC whitebox builders/retailers in my area and they haven't had the product. Those here that have found retailers with product have found it to be on back order in some instances. I think there might have been some slight delays in the upgrading of certain things that may have pushed some things out further than expected. I think the expectations were very high coming in to this quarter and until Friday we had not seen any serious volume which is more than likely short term traders and nervous long selling off on no news in the last few weeks. Given the nice price increase we have seen in the product and upgrades in place I expect third quarter to be quite a revelation.
Dave
RIM to Use Intel in BlackBerry Devices
Tue Sep 27,10:44 PM ET
http://news.yahoo.com/s/ap/20050928/ap_on_hi_te/intel_blackberry
Could this set the ground work to get Wave's foot in the door here? Time will tell.........
Research in Motion Ltd. said Tuesday it will use Intel Corp.'s cellular microprocessors in upcoming BlackBerry devices as it tries to boost performance without sacrificing battery life.
The widely expected move is expected to improve the BlackBerry's ability to handle multimedia and Internet applications. The gadget is best known for its thumb keyboard and wireless messaging and some models also have phone and handheld computer capabilities.
Waterloo, Ontario-based RIM has chosen the Intel PXA9xx cellular processor, code named "Hermon." The first BlackBerry products with the new technology would be available later this year, said RIM President Mike Lazaridis. No pricing was announced.
"We chose the Intel PXA9xx cellular processor because it provides us with the increased processing horsepower we need for future wireless applications, without compromising battery life requirements," he said.
The companies also announced that they will work together to develop additional wireless and phone features.
The deal comes a day after RIM rival Palm Inc. announced it was offering a smart phone that runs Microsoft Corp.'s Windows Mobile operating system. The switch from PalmOS, now developed by a separate company, is expected make Palm more competitive.
Tuesday's announcement represents a return to Intel for RIM. Some previous BlackBerry devices were built on Intel 386 chips — the same processors that powered desktop PCs in the late 1980s and early 1990s.
Neither RIM nor Intel would disclose what chips are used in existing high-end BlackBerry devices.
Coming Next Year: The First 'Trusted' Linux Operating System
Red Hat, with help from IBM and Trusted Computing Solutions, plans to put its operating system through the paces of the National Information Assurance Partnership's Common Criteria evaluation program to create the first "trusted" Linux operating system.
By Larry Greenemeier, InformationWeek
Sept. 27, 2005
URL: http://www.informationweek.com/story/showArticle.jhtml?articleID=171201116
The National Security Administration has for years been calling for someone--anyone--to develop a secure, mainstream operating system that can address system access and other security concerns at the very heart of an IT infrastructure. Now a coalition of open-source technology providers plans to heed the government's call by using Linux as the platform for delivering a highly secure operating system to the masses.
Red Hat, with help from IBM and Trusted Computing Solutions, said Tuesday that it plans to put its Red Hat Enterprise Linux operating system through the paces of the National Information Assurance Partnership's Common Criteria evaluation program in a move to create the first "trusted" Linux operating system. When the next iteration of Red Hat Enterprise Linux, version 5, is released in late 2006, it's expected to have a rating of Evaluation Assurance Level 4, or EAL4, and achieve "trusted" status by including labeled security protection profile, controlled access protection profile, and role-based access control protection profile security capabilities.
"The big thing here is that it makes Red Hat Enterprise Linux 5 the only other trusted operating system in the world, beyond Trusted Solaris," says Ed Hammersla, chief operating officer of Trusted Computer Solutions, a provider of security software and services. "It's a big milestone in the maturity of Linux."
A trusted operating system is valuable for government agencies and businesses because it allows system administrators to deliver different levels of security on the same system. For example, an intelligence agency can manage access to secret and top-secret data on a single system, even if users have different security clearance levels. This is useful in the business world as well, as companies seek to provide access to different types of information to different end users, whether they're employees, customers, or business partners.
The trusted version of Red Hat Enterprise Linux will build upon the Security Enhanced Linux, or SELinux, guidelines the NSA developed to make the operating system more secure. The Linux community in 2003 included SELinux's mandatory access control capabilities in version 2.6 of the kernel, upon which Red Hat built version 4 of its Red Hat Enterprise Linux.
Red Hat rival Novell has taken a different route to security with its SuSE Linux operating system. SuSE Linux Enterprise Server 9 has since February held an EAL4+ certification and was likewise built around the 2.6 Linux kernel. Novell, however, has not been as vocal an advocate for SELinux, saying the technology's features are too complicated for users to fully implement. Instead of pursuing a trusted operating system, Novell's strategy has been to encourage the combination of multiple layers of security beyond the operating system.
Novell in May acquired Immunix Inc. and its AppArmor software, saying at the time that, while EAL certification is a reflection of the operating system's access controls and password protections, AppArmor is used to build a shield around applications operating in the Linux environment that prevents them from being co-opted by viruses, worms, and other malware into doing things they shouldn’t. Using application containment technology, AppArmor is designed to keep applications from "masquerading," or using ill-gotten permissions to do malicious things.
The main problem with trusted systems has been their cost. The most common trusted operating system to date has been Trusted Solaris, which is more expensive than a normal Unix operating system and in the past ran only on more expensive RISC-based servers. Trusted Linux, by contrast, would be open source and run on less expensive X86-based servers. "That's a huge driver for customers as they try to find ways to take these trusted applications to commodity hardware," says Paul Smith, Red Hat's VP of government sales operations. The greatest expense would be for support services, particularly for government agencies that require their service providers to hire pricey consultants with high levels of security clearance.
In fact, trusted Linux stands apart from other trusted operating systems developed over time because it won't raise operating-system licensing or hardware costs. Red Hat is able to provide improved security functions to the operating system without adding to the cost because Red Hat didn't have to invest significantly in trusted Linux R&D. Instead, Red Hat contributed about 20% of the new code to improve the operating system's security while IBM and the open-source community did the rest. "With that collaboration, we can produce a better, faster, cheaper model," Smith says. "This will open up trusted Linux to more mainstream customers in more industries, including health care and financial services, anywhere an organization has multiple layers of users needing access to different types of data."
The work to qualify Red Hat Enterprise Linux as a trusted operating system will be done in October on IBM x86-based eServers at an Austin, Texas, lab run by Atsec Information Security Corp., an independent consulting company. Red Hat Enterprise Linux 5 will be evaluated on IBM xSeries, pSeries, zSeries, and BladeCenter servers. The government's formal recognition of EAL4 status will take place sometime over the next 15 months.
Although trusted Linux will formally debut with Red Hat Enterprise Linux version 5, more-industrious users will by the end of next month be able to access the enhanced security capabilities through Red Hat's Fedora project, a Linux code repository run by the open-source community.
Trusted Computer Solutions partnered with Red Hat in order to avoid having to create its own secure distribution of Linux. "Red Hat also embraced SELinux more than another provider of Linux," Hammersla says. Trusted Computer Solutions plans to port all of its products to run on Linux by the time Red Hat Enterprise Linux 5 is ready next year.
"This makes a trusted operating system essentially mainstream, which is something the NSA has wanted for a while," Hammersla says, noting that the NSA in 1998 published a paper entitled "The Inevitability Of Failure: The Flawed Assumption Of Security In Modern Computing Environments", which called for the development of secure mainstream operating systems.
Copyright © 2005 CMP Media LLC
I think there is a lot more to this Gino's than meets the eye. I think Wavxmaster hit it on the head with the transferring of sensitive information via the net. At the very least-and this makes sense because you don't have an incredible number of machines involved to muck up the works-Wave now has a working, active, real life business example of how their system functions in an ongoing business operation. It isn't one store, it's a bunch of networked stores. This is where the value from this will be derived. Who would have thought that a relationship with Gino's would probably pay off bigger than EDS??
Dave
Wave Systems Launches First Enterprise-Class Secure Software Solutions Suite for Trusted Computing Market
Monday September 26, 6:03 am ET
Wave's Embassy(R) Software Platform Delivers Flexible and Cost Effective Trusted Computing Solutions to Papa Gino's New England Restaurant Chain
LEE, Mass.--(BUSINESS WIRE)--Sept. 26, 2005-- Wave Systems Corp. (NASDAQ:WAVX - News, www.wave.com - News) announced today that the next version of Wave's secure software platform, Embassy Trust Suite 5.0 and the Embassy Enterprise Authentication Server, is now available for trusted computing for business and government applications. New and improved trusted computing features include network policy management, data protection, biometric authentication, smart card authentication, password authentication and machine authentication of a user's personal computer to a server.
ADVERTISEMENT
Wave's newest Embassy platform capabilities include sophisticated policy management capabilities delivered by the authentication server. The Embassy software is designed to allow an IT manager to set varying security policies in a business, so that one department, such as accounting or legal, could be required to logon to trusted computers using biometric sensors, while other departments, such as shipping, could continue using passwords and or smart cards or the TPM itself using PKI certificate authentication. Using the Embassy platform, IT managers can change the departmental security policies as needed.
"We have evaluated many of the trusted computing solutions available from the PC industry and believe that Wave's Embassy software was the best solution available," said Chris Cahalin, network manager for Papa Gino's Holdings Corp., who is responsible for the corporate network comprising more than 400 D'Angelo Sandwich Shops and Papa Gino's restaurants. "We are especially pleased with our ability to easily encrypt files for overnight backup and be able to keep the encryption keys safely stored in a separate server. If those back up files are ever lost or stolen, as we have seen reported in the news about other companies recently, the data would be safe because of the encryption. We are using Wave's trusted computing technology for applications today, from data protection to policy management to password management. We believe it is a superior solution."
Wave's Embassy software is designed to support the next generation security chip hardware, called Trusted Platform Module (TPM) 1.2. The computer industry has shipped millions of PCs embedded with the Trusted Computing Group-standard TPM 1.1 chip and now shipping is the next generation 1.2 TPM chip. Wave's Embassy platform supports both standards.
TPMs help enable secure services and applications. Wave has designed its Embassy technology to work with all commercially available TCG-compliant TPMs. Wave's Embassy platform is also designed to be compatible with the Microsoft Office® environment, and to facilitate a variety of PC-related security and productivity tasks.
"Now trusted computer users have available a simplified yet enhanced level of security protection through the implementation of strong authentication capabilities that make available biometrics, smart cards, passwords or the TPM, all tailored to specific business needs," said Steven Sprague, president and CEO, Wave Systems.
"In addition to the enhanced single client solutions, Wave has available new authentication server capabilities for secure logon to Windows domains, computer platform attestation, policy management solutions across an enterprise domain and new key management capabilities," said Brian Berger, Wave executive vice president, marketing and sales.
Wave's Embassy Trust Suite is designed to be integrated with Wave's key backup server solution, Key Transfer Manager Enterprise Server. Embassy technologies are designed to provide IT administrators the tools needed to configure, manage and backup their trusted PCs.
Important attributes of Wave's Embassy Trust Suite 5.0 include:
Embassy Security Center - for establishing security policy management to strengthen authentication to Microsoft Windows and other secure applications with multifactor authentication capabilities.
Document Manager Vault - for protecting files and folders in multiple, networked, sharable secure drives that are compatible with Microsoft Windows Explorer.
Private Information Manager - for secure storage and automation of user names, passwords and personal information.
SmartSignature - for digital signature capability of secure electronic contracts.
Key Transfer Manager - for backup and protection of hardware encryption keys.
Embassy Enterprise Authentication Server - for policy managed authentication requirements to the domain.
Wave is a member of the Trusted Computing Group (TCG), an industry organization dedicated to embedding trust and security more broadly into computing platforms and devices. More information on Wave's ETS software is available at www.wave.com.
About Wave Systems
Consumers and businesses are demanding a computing environment that is more trusted, private, safe and secure. Wave is the leader in delivering trusted computing applications and services with advanced products, infrastructure and solutions across multiple trusted platforms from a variety of vendors. Wave holds a portfolio of significant fundamental patents in security and e-commerce applications and employs some of the world's leading security systems architects and engineers. For more information about Wave, visit http://www.wave.com.
Safe Harbor for Forward-Looking Statements
Except for the statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the ability to fund operations, the ability to forge partnerships required for deployment, changes in consumer and corporate buying habits, chip development and production, the rapid pace of change in the technology industry and other factors over which Wave Systems Corp. has little or no control. Wave Systems assumes no obligation to publicly update or revise any forward-looking statements.
All brands are the property of their respective owners.
--------------------------------------------------------------------------------
Contact:
Wave Systems
John Callahan, 413-243-7029
jcallahan@wavesys.com
or
Jaffoni & Collins
David Collins, 212-835-8500
wavx@jcir.com
Go Kite... I think this is a valid point that deserves some consideration. The security products that are availble today were developed over a long period of time,wads of cash, and a lot of pushing and shoving to gain a prominent position on the operating system. I for one use Norton on my 3 year old Dell, never removed the MacAfee that came with the unit, yet MacAfee's start up menu is always there when I boot the PC on. I know it is still there because I have been too lazy to delete it, but it is there at the start up every time. Wave aspires to be like this in some form, but do you think these entities want to give up that real estate without a fight? I am sure these folks are whispering in the ears about privacy concerns, big brother etc. The money is in the disease not the cure. Let's roll out more patches, updates etc.
If a tree falls in the forest and nobody hears it does it make a sound. If Wave's security is the be all end all and nobody but the Wave shareholders and those in the most technical of positions at the OEM's realize it, does it make a dent in the marketplace? Until we see real revenues here we will see this share price meander on the whims and winds of whatever and whoever controls the shareprice at that given time. Wave needs to show revenue soon, this quarter we should see that. Intel has been in the picture over a year and Dell, STM revs should be coming in in some tangible form. We need to see a concerted push by the OEM's to educate the consumers as to what the TPM and Trusted Computing can do for them. You can have every machine with an installed base of TPM's and if nobody is taking advantage what's the point? We need to see a campoaign based on why you need to have a trusted PC. If all the OEM's plan on making this a standard this shouldn't be far behind. This is no knock on the product or our management. I have faith the product works or we would not see the names we do in the company with Wave. Hand in hnd with that goes credit to those running this company who I am sure could have handed the ball off, sold out or who knows what else long before this. One thing remains constant,the ball is certainly not in Wave's court.
Wave partner Comodo and Microsoft..........
Microsoft joins industry leaders in offering enhanced online identity assurance verification tools on its IE platform
The ability for consumers to verify the authenticity of online merchants is gaining momentum as industry leaders such as Comodo and Microsoft offer solutions to combat online fraud
New York, NY US - Comodo Inc., a global leader in Identity Assurance Management solutions announced today that the advanced features now included in the forthcoming Internet Explorer 7.0 product will allow users to make informed trust decisions whilst transacting online. Aimed at enabling identity assurance in online ecommerce, Microsoft’s IE 7.0 Beta is currently being scrutinized by development groups worldwide. Microsoft has specifically enhanced the functionality available to users during a secure SSL enabled session. The new ‘Security Status’ bar offers consumers a simple and effective line of sight trust indicator in the form of a new padlock symbol. Those organizations choosing to use a High Assurance certificate on their web site will see tremendous benefits as consumers begin to utilize the functionality of the new padlock to reveal details about the organization or entity with whom they are transacting. Comodo Inc. as the world's 2nd largest High Assurance Certification Authority after VeriSign, has been actively working within the industry to deliver the technology backbone for this pervasive issue, essential to the long term success of e-commerce.
“With the release of this new tool, it is becoming more and more important for online merchants to have the right set of certifications that signal to consumers that their site can be trusted for transactions and purchases, said Mr. Melih Abdulhayoghu, CEO and President of Comodo. “Many current practices, including low assurance SSL certificates, will simply not be suitable going forward to create trust online as online merchants recognize that to create trust online requires a combination of infrastructure and fraud prevention technologies to capture the largest share of online revenue.”
Microsoft has released a technical overview highlighting the reasons behind the enhancements:- “With the explosion of small- and home- based business Web sites selling goods that span the pricing spectrum, users are even more likely to encounter unknown entities asking for their financial information. These factors combine to create a situation ripe for malicious abuse. Internet Explorer 7 addresses this issue by providing users with clear and prominent visual cues to the safety and trustworthiness of a Web site. With the assistance of Internet Explorer 7 to help identify legitimate Web sites, users can more confidently browse and shop anywhere on the Internet.” (‘Technology Overview: Microsoft® Internet Explorer 7 Beta 1 for Windows® Vista™ and Windows XP SP2’ - Published 7/27/2005)
Printed from WWWCoder.com
www.wwwcoder.com
Maybe they have adapted other facets than what was revealed in this PR from 2003
Comodo, Wave Systems Announce Parntership
March 6, 2003 -- (WEB HOST INDUSTRY REVIEW) -- Internet security company Comodo (ComodoGroup.com) announced on Wednesday that it has formed a partnership with secure hardware and software solutions provider Wave Systems Corp. to introduce the SignOnline eSign Transaction Management Suite.
According to Comodo, eSign Transaction Management (eTM) allows organizations to manage business processes and transactions online, without the need for ink signatures and paper storage, overnight mail or traditional delivery systems. Using the eTM Suite, says Comodo, organizations can create, sign, store access and manage the lifecycle of legally-binding electronic records.
Comodo will offer Wave's eTM Suite portfolio as part of its range of products and services. The company says it has released a number of standards-based products and solutions for privacy, security, trust and confidence, recognizing that trust and security are fundamental to successful online business.
"Partnering our outsourced PKI services and more specifically our ePKI certificate platform with WAVE builds a complete signing solution for enterprises worldwide," says Comodo Director Jim Whiffin. "The depth of this application in meeting the legal requirements of online commerce is fantastic. Coupled with our outsourced certificate platform, enterprises can today transform their business process and start realizing huge cost savings."
Snack I think you should check your statement.
http://www.morganstanleyindividual.com/markets/fundcenter/morganstanleyfunds/
I checked my Oakmark prospectus and for laughs went to the Morgan site and randomly checked about 8 different funds, among them Growth, Aggresive, and balanced - no Index funds Not one mentioned a dollar amount that prohibited the fund from investing. They did however state what protion of the fund , be it 75% etc would be invested in equities. My Oakmark fund makes no mention of a pric, only stocks that are deemed undervalued, but never a price barrier.
Dave
In Barron's, they are showing WAVX with earnings next year at .18 in the weekly Nasdaq Market wrap up First time I have seen that.
Dave
Interesting day today. I think the gidiness over some bombshell revs dropping should be subsiding. That being said, we had to know this was coming, hell we expected it to happen and got sidetracked by the warrants. We did shake the delisting notice off, and got the double bang of cash influx coming in. I think we probably book between 450 and 725K for the quarter. As long as it is steady uypticks I'll be happy. Some folks want to see double digit growth, me too!, but I think it is too early this quarter. Fact is we need more resellers, but they are coming. The supply chain is very visible, but the chain ain't much good until the links are connected. Right now we can only see about four or five for sure, but the others can't be far behind. Just look how far this has come since the 1st of this year alone. I know my Google hits are certainly much higher and they aren't all to the same article anymore. Maybe we get a juicy tidbit tomorrow.
Dave
New demands boosting chipset market to $10 billion
By Michael Singer
URL: http://news.zdnet.com/2100-9584_22-5813928.html
Computer chipsets, which help feed the main brain of a PC, are a booming business in the first decade of the 21st century.
The PC core-logic chipset market is expected to grow from an estimated $6.9 billion this year to $10.3 billion in 2009, according to analysts at chip research firm In-Stat.
The report published Monday, entitled "The Trendy Chipset for the x86 Processor," suggests that continued demand for new PCs, combined with new semiconductor processor standards, will help build an industry that's populated by the likes of Intel, Broadcom, Atheros, Via Technologies and Silicon Integrated Systems.
"The chipset is a critical component in the PC design, and chipset designs are changing rapidly to support these new features," said Chris Kissel, an In-Stat analyst.
For example, the next generation of chipsets will be required to support processors with multiple cores, new front-side bus architectures, new peripheral interfaces and a growing list of demands such as managing security and running multiple operating systems, Kissel said.
Newer chipsets have generally included functions provided by two or more older chipsets such as Intel's 955 Express chipset, which combines high-speed storage interface and high-definition audio. In some cases, older chipsets that required two or more physical chips can be replaced with a chipset on a single chip like Intel's 855 Centrino chipset, which adds in compatibility with wireless networks.
The reliance on chipsets has come to the forefront in the last few years because processors made by Intel, Advanced Micro Devices and IBM are running into problems with heat and performance. What used to be a race to show off the fastest processor has now turned toward chipsets as the gauge of a successful chip. For example, one chipset may provide the basic functions of a modem and direct traffic along the motherboards without having to go through the CPU.
The challenge for PC chipset vendors, Kissel said, is to make sure the chipsets meet all of the latest requirements and integrate as many features as possible without undue expense.
Other new factors are coming into play, according to Kissel's report. One is the increase in chipset production supporting AMD's Athlon and Opteron processors.
Unlike Intel, AMD relies on outside vendors to make its chipsets. Although less than 20 percent of x86-based processors like the Pentium or Athlon have an integrated memory today, In-Stat forecasts that roughly 70 percent will have integrated memory controllers in 2009, a trend similar to what happened in embedded processing.
Another factor is that PCs are also seeing a shift from their traditional processor-to-motherboard interfaces to ones that use PCI Express. The high-speed data transfer technology is expected to account for more than 84 percent of all graphics interfaces and 98 percent of all peripheral interfaces in 2009, according to In-Stat.
And as processors increase in the number of cores and the amount of memory, In-Stat said, chipsets will need to rely on more external logic for faster data transfer.
Cheap Intel chipsets on the way out
http://news.zdnet.co.uk/hardware/chips/0,39020354,39212013,00.htm
Michael Singer
CNET News.com
August 04, 2005, 09:25 BST
The chipmaker is phasing out its lower-spec chipsets in a move that could delay shipments of budget PCs
Intel will phase out production of three low-end chipsets for desktop PCs in favour of selling its higher-end and Centrino-based products, ZDNet UK sister site CNET News.com has learned.
The move, expected to take place by the end of August, could delay shipments of low-end PCs from various manufacturers for a couple of months.
Sources close to the chipmaker's dealings confirmed reports that Intel would shutter production of its 910GL, 915GL and 915PL chipsets. The three microcontrollers that work with Pentium 4 and Celeron D chips were expected to make up about 20 percent of Intel's desktop chipset supply in the second half of this year.
An Intel representative dismissed reports suggesting the company was exiting the low-end chipset business altogether but said the company was in the middle of making changes to its manufacturing plants to make way for more mobile-focused and high-performance products. Despite reports of which products would be phased out, Intel declined to officially state which chipsets would be put on the back burner.
"Our factories are now running at full capacity, but we are experiencing changes and, temporarily, there will be shortages," Intel representative Bill Kircos said. He added that the company is expecting a product refresh later this year on all of its top brand-name processors: Pentium, Xeon and Itanium.
Intel's shift toward higher-performance chipsets may indicate that the company is ready to address next-generation chips with support for processors with multiple cores, new front-side bus architectures, new peripheral interfaces and a growing list of demands such as managing security and running multiple operating systems.
Rival chipset manufacturers such as Silicon Integrated Systems (SiS) and Via Technologies are primed to take advantage of Intel's production changes, according to a recent Morgan Stanley report.
"Between SiS and Via, they [Intel] prefer SiS chipsets for the Intel CPU platform given the better graphic quality," Morgan Stanley analyst Ellen Tseng said in a newsletter to investors.
However, Tseng noted that motherboard makers are also apt to increase orders based on AMD giving Via a leg up on SiS. Via controls about 50 percent of the AMD platform-based chipset market.
Motherboard makers, however, are concerned about whether either SiS or Via can fill in the gap until late September or October, unless the two companies can resolve supply issues form Taiwanese fabrication plants UMC and TSMC, as well as their packaging and testing issues.
Via representative Richard Brown said Intel's movements are welcome since Via expects continued strong growth in the entry-level desktop PC segment over the long term.
"We are seeing very strong demand for our Pentium 4 IGP chipsets such as the Via P4M800 targeted at the entry-level desktop PC market," Brown said. "Intel's moves are of course one major reason for this, but growing demand in emerging markets such as India and China is just as important a factor."
Intel's laser focus on mobile chipsets is well documented. More than half of the mobile processors shipped by Intel are based on its new notebook PC platform, formerly code-named Sonoma, even though it is only three months old, the company said during its earnings call last month.
APPLE-"The existence of the TPM chip, manufactured by Infineon Technologies"
http://news.zdnet.co.uk/software/developer/0,39020387,39212178,00.htm
Coders worried by DRM chip in Apple's Intel box
Michael Singer
CNET News.com
August 05, 2005, 13:05 BST
Builder: A chip needed to install Mac OS X on x86-based machines could be used for more than just allowing the operating system to be installed
Apple fans are upset over a security chip found in a special x86-based PowerMac—a chip designed to prevent people from loading the company's new Intel-based OS onto non-Apple machines. Apple supplied the Intel-fitted PowerMac to members of its Apple Developer Connection. The PowerMac includes a microcontroller known as the TPM that contains a digital signature necessary in order to install the Mac OS X operating system onto the box.
An ADC member, who asked not to be identified, confirmed the microcontroller's existence to Builder UK sister site CNET News.com. Representatives of Apple and Intel declined to comment on the inclusion of the TPM chip in the PowerMac.
The ADC source reported being able to install other operating systems like Windows and Linux onto the test box. But it was impossible, the source said, to install software from the DVD containing the Intel-configured Mac OS onto similar x86-based PCs that lacked a TPM.
Some Mac fans disagree with Apple's desire to prevent the loading of its Intel-based OS on non-Mac boxes. Another issue for some is that the TPM could compromise the privacy of users because of the identifying number built into the chip. The technology could also restrict the use of some digital media by enforcing digital rights management technologies.
Reactions on the OSx86 Forum, Slashdot and other fan sites ran the gamut from annoyance to just plain resentment against Apple for joining Microsoft, Advanced Micro Devices, Hewlett-Packard and Lenovo in support of the technology. "The 'bru ha ha' is that it won't just be the ADC people that have to deal with TPM. Everyone that buys a new Mac will. That's what the big deal is. No one wants to deal with the TPM," said an OSx86 Forum moderator known as Mashugly. One fan threatened to remove his Apple tattoo should the company include the security chip in its new Macintosh products, which are expected to be on sale by next summer.
Those overly concerned with the issue may have short memories. During the announcement back in June, Apple said its machines would not support other operating systems outside of the Mac OSX, but the company also said it would not be able to prevent underlying software from Microsoft or a Linux distribution from being installed. Apple is currently transitioning its computers to Intel processors from the PowerPC chips made by IBM. In addition to hardware, Apple is supplying software and other resources as part of its Developer Transition Kit.
A representative with Apple did say that the computers shipped to developers are the same as the one Apple CEO Steve Jobs used during a demo onstage at the company's developer conference in June. Participating developers received a PowerMac that runs on an Intel D915GUX motherboard powered by a Pentium 4 660 Prescott that reaches top speeds of 3.60GHz, the ADC source said.
The existence of the TPM chip, manufactured by Infineon Technologies, is no guarantee that Apple will be using it in the final Macintosh products shipping next year. But industry analyst Pete Glaskowsky says it is highly likely, considering that Apple has the controller installed now. "Apple does not want just anybody that has the right Intel motherboard to install the beta version of its software." Glaskowsky also surmised that Apple developers will come across more surprises as they familiarize themselves with the new Mac architecture.
The ADC source said one welcome surprise was that the combination of Intel chips and the Mac OSX seems to have led to the ability to perform tasks and play games incredibly fast.
FBI Launching New Infrastructure System
August 5, 2005 4:55 p.m. EST
http://themauritius.com/redirect/index.php?url=http://www.allheadlinenews.com/articles/2246550608
Christina Ficara - All Headline News Staff Reporter
Washington, D.C. (AHN) - The FBI announces successful deployment of its Public Key Infrastructure (PKI) - enabling the FBI to move towards an automated, paperless case management system.
PKI's enhanced security features are critical to the FBI's Sentinel program and also further enables information sharing with law enforcement partners and members of the Intelligence Community.
According to an FBI release, PKI is deployed to 33,000 desktop computers and makes advanced security features available to 28,000 FBI employees, taskforce members, and contract employees. It provides individuals with a Digital Identity, eliminating the need for signature hard copies. This new capability allows for digital signature approval, which moves the FBI closer to the development of Sentinel, a fully automated information management system.
An enhanced encryption provides more secure safeguards, protecting the FBI's computer systems and the information stored on them by requiring users to prove their identity twice, through the use of their smartcard and personal password.
Deployment of PKI was done through a partnership between FBI management and PKI contractor Northrop-Grumman Information Technology and its subcontractors PEC, Entrust, and BAE.
Internet TV: Still Fuzzy, but Promising
no TV Tonic mention but nice props for MSFT
http://www.pcworld.com/news/article/0,aid,122138,00.asp
Microsoft teams with a variety of carriers to vie for bundled home entertainment services.
John Blau, IDG News Service
Friday, August 05, 2005
Several big telecommunications operators and the world's largest software maker hope to pursuade many couch potatoes to zap their old-fashioned notions about television and tune in to its convergence with the Internet.
Internet TV, or IPTV, is arguably one of the hottest new technologies in communications. A handful of operators already offer service with largely home-grown systems, but many eyes are glued to the screen to see what Microsoft is concocting with some big-name carriers.
Using the same DSL connection that gives customers broadband Internet access over phone lines, Microsoft-aligned operators such as BT Group, Telecom Italia, SBC Communications, and India's Reliance Infocomm aim to add TV for a much-cited "triple play" of bundled voice, data, and video services. Their premise: If--in our age of the digital packet--documents, images, music, and even phone calls can be broken up into bits, thrust through networks, and reassembled by Internet protocol at the other end, why not TV?
It's a legitimate question, and one that telephone companies--painfully aware that the days of their cash-cow circuit-switched telephone business are numbered as cheap Voice over IP (VoIP) services go mass market--aim to answer, despite their failed attempts at TV service in the past.
Tech Hits Its Time
More than a decade ago, several big carriers, such as Deutsche Telekom, tried unsuccessfully to deliver television service over analog lines. Now, digital technology makes them more likely to succeed, says Laura Behrens, principal research media analyst at Gartner.
"Delivery of anything digital into the consumer home is so much more reliable and less costly at the operating level than anything operators ever dreamed of in the analog era," she says.
The quality of the digital stream into homes, however, is a big factor, and one that operators say will distinguish IPTV from video streamed to a PC. On the public Internet, packets can be delayed or lost entirely, which is why Web video is often jerky and of low resolution. IPTV, by comparison, is engineered for end-to-end delivery of high-quality video as good as any digital cable or satellite feed.
A dedicated transmission path is one necessity. Another is a high-performance set-top box. Still another is software that unites all the pieces.
For instance, in the IPTV service that French network operator France Télécom has been offering over DSL since March 2004, live TV programs and video-on-demand are transmitted as MPEG-2 streams over an IP connection. The video streams and normal Internet traffic are kept from interfering with each other by transmitting them in separate virtual channels over the same line.
Microsoft Eager
IPTV set-top boxes can now highly compress video, reducing network congestion and the jumpiness of video simply because the signal takes up less network capacity. Also, the TV signal can travel over narrower channels than previously possible.
Software plays a crucial role in helping the many different systems communicate. That's where Microsoft hopes to make its mark. Around a dozen well-known operators are testing Microsoft TV IPTV Edition software. One competitor, German electronics giant Siemens, uses a rival TV system and has struck deals with a handful of international operators.
"Microsoft has designed a client-server system to run on the infrastructure of numerous vendors," said William Cooper, principal consultant at consultancy Informativ.com in London and author of a study on IPTV. "This is something that the company has mastered in the PC world."
Cooper says carriers want to work with Microsoft, which wants to extend its home computing expertise to the emerging home entertainment market and other home networking opportunities. It helps that the software company has persuaded French telecommunications giant Alcatel, a trusted name to many carriers and one of the world's largest suppliers of DSL equipment, to abandon its own IPTV plans and work with Microsoft.
Slow Progress
But all said, the picture Microsoft has produced so far is a bit fuzzy.
In May Swisscom, one of the first telcos in Europe to test Microsoft's software platform, delayed its launch of commercial service from late 2005 to sometime next year largely because of technical difficulties with the software.
"They aren't as far along as they thought they would be," says Pia Colombo, Swisscom communications director, of Microsoft's efforts. "Now we are going to have to wait until all the kinks are worked out."
In June, Australian telco Telstra dropped out of Microsoft's early adopter program.
"We are investigating IPTV because it makes sense for a telco in our position to do so," says Telstra spokesperson Warwick Ponder. "But if and when we make a decision to offer an IPTV service, from a commercial and technical perspective, we will look at a number of serious options, including Microsoft."
Similarly, the three big carriers Microsoft has lined up in the U.S.--BellSouth, SBC, and Verizon--have delayed their rollout plans.
No one said the move to IPTV would be a breeze.
"There are lots of pieces to the big IPTV puzzle," says Ed Gracyzk, director of marketing for the Microsoft TV division, of his group's challenges in deployment. "We're one of those pieces, and we aim to finish our software later this year. But every telco has its own requirements, too, and will need to work closely with its suppliers for set-top boxes, encoders, content, and more to make everything work."
Microsoft's Features
Some analysts question whether the technology is ripe enough to provide service to thousands of customers simultaneously.
"Microsoft's IPTV software platform works; I've seen it and I'm impressed," Cooper says. "But it's one thing to show the service using a single client and a single server at a trade show and quite another to deploy the service in a large, live network where lots can go wrong."
Microsoft remains convinced that its IPTV technology will succeed and change the way people access broadcast TV, movies, and other video content, as well as how they interact with the service.
"Our IPTV solution offers a bunch of better TV features, like an elegant user interface, easy navigating, instant channeling, and an interactive program guide," Microsoft's Gracyzk says.
Some critics say rival systems provide many of the same features, but Cooper calls the Microsoft interface, which is similar to that of the Windows Media Center operating system, "really sexy" and its instant channeling "truly unique in the industry."
Microsoft's technology cuts the 1- to 2-second delay typically required to switch channels in satellite and cable transmissions to under 150 milliseconds "or faster than the blink of an eye," Gracyzk claims.
The picture-in-picture program guide feature allows users to open up one or more smaller screens and simultaneously view programs on other channels.
Luring Viewers
Microsoft expects its software platform will also support what Gracyzk calls "connected entertainment," linking all digital devices, such as PCs, game consoles, video recorders, and phones in the home. Such linkage is a possibility if telcos choose Microsoft's platform, which the company calls the only "end-to-end" system in the market. Gracyzk agrees that the platform connects every component in the IPTV value chain, from the point content enters the network to its display on the TV screen.
That's tempting for telcos, but also scary because it commits them to a single software platform, according to analyst Cooper.
Telcos also face a content challenge: convincing TV stations, movie studios, and other producers to work with them. They'll need to offer a program lineup that is not only as compelling but also as broad as those already beamed free by satellite operators. Otherwise, users may not be interested.
"The interactive features of IPTV sound really cool, but I already have free access to more than 3000 programs via satellite, so I'm not going to be easily persuaded to use this new technology, especially if I have to pay for fewer programs," said Pedro Mpaltatzis, an avid PC and TV user in Duesseldorf, Germany.
Operators are not unaware of such customer concerns. Everything Microsoft promises in its platform is arguably nice and perhaps necessary to draw interest. But if the core service--content--is insufficient or costly, this new form of television may not win enough eyeballs to make it a lucrative business, as happened to systems before it that failed.
Gilder is also appearing in D.C. August 11-13 at something called The Moneyshow at the Wardman Park Marriott. The ad was in the August 1st Barron's page 9 web link is www.DCMoneyShow.com
looks like George is speaking about "Looking Forward to Technology beyond 2005"
Pictured in the add and on the bill are Ed Finn, Lawrence Kudlow, Steve Forbes, Frank Cappiello, and Ken Harney
Dave
Snackman, my take is that it was quite possible that the deferred revenues from the last quarter bought them some time into which some revs and hard numbers of units moved gave them the abillity to stave off another PP at this juncture. Couple that with some inkling by folks of what the future revs were shaping up to be could have led to some buying. Outside of the traders I don't think you had any major selling by longs. If you want to figure in the psychology of the stock here as I see it, most holders are at an all or nothing stage here in this stock as of 2 weeks ago. We new the cash was running low or out. We new a PP was imminent. The stock hasn't really done anything to stir up excitement this year-in a share price sense only-, so I don't believe the buying or selling was done buy a majority here. I think at this point most of us have placed the bets and are waiting to see what transpires for better or worse. I think the company is better positioned today than at anytime since I have been a shareholder. Had the events that have unfolded this year alone happened during 99/00 this stock would probably have had a shareprice triple of the highs it reached at that point.
Dave
Microsoft Vista ends DVD Piracy for good!
http://www.discwrite.co.uk/modules.php?name=News&file=article&sid=375
Microsoft (MS) just announced the beta release of an assortment of operating systems (OS), tools and programs that intend to elevate user experience and productivity when using the next version of its operating systems and programs.
1. beta 1 of its long awaited next Windows version, initially called Longhorn and now named “Vista”, has already been made available to beta testers as an early feature-inspection package,
2. beta 1 of Internet Explorer 7.0 is currently being offered as part of the Vista beta 1 release and also as an add-on for Windows XP SP2 installations,
3. betas of the new server family of operating systems (still code-named Longhorn) are also expected to be simultaneously available for inspection, early testing and development,
4. among all these, service pack (SP) 2 for the Windows 2003 series of OS’s has also been scheduled for release. It is now called Windows 2003 Release 2 (R 2) and also includes 3 new feature packs as well, something justifying the renaming of SP 2 to R 2.
All these releases are currently offered only to official MS beta testers and MSDN subscribers. Some of them will possibly be also available, later, through TechNet.
Although most of these new offerings will not be ready for official release before one and a half to two and a half years by now, they already get a lot of attention through the online publication press.
1. The new Windows OS Vista is intended to replace the Windows XP line of products. It is expected to include both the code-named Avalon and Indigo technologies. The first is related to vector-graphics presentation through common monitors (in the way NEXT did 10-15 years ago). The second builds upon the NET MS web services initiative and is expected to promote interoperability and ease of use.
Many new security features are included in the new OS, the part of which that is viewable by the end-user includes an enhanced firewall for blocking also outbound PC traffic, in the way Kerio, Norton Anti Virus and other programs already do today.
Many users are aware of the 3 in 1 OS CD versions circulating the web. The good news is that MS is embarking this “technology” itself as a way of cutting off medium cost when releasing multiple versions of a program with overlapping data content.
Most other reported enhancements are among those to be expected from a company with the tracking record of Microsoft on which all of us rely on for easing our day to day tasks.
2. The IE 7.0 beta 1 is expected to offer dynamic security and malware protection, as well as full control over installed and activated add-ons. It offers tabbed browsing in the way competing browsers already do. Inline search gets more “democratic”, as search engines other than MSN (like Google) are now pre-included.
Users will also be able to easily locate and read RSS feeds and bloggs, similar to how users of other browsers (like Opera and Mozilla) already enjoy.
3. The Windows R2 beta currently seems to users more of a nuisance than a performance enhancement, as it requires SP 1 installation, unlike other previous windows service packs.
Two are the most important of all these announcements related to end-users.
* First is the inclusion of a vector graphics engine (Avalon) as a presentation layer for all next versions of windows, as well as some of the latest existing versions. (It seems now is a good moment for anyone to extend his portfolio buying graphics chip-makers stock!)
* The other is the inherent windows support for the new Trusted Platform Module (TPM) 1.2 hardware chip set.
By using a constant through time kernel memory to PC processor two-way association, certain OS functions cannot be performed (decoded) in case this relation breaks. Establishing this relation early enough during OS boot, certain parts of the OS itself will not be exposable for debugging and can thus be used for defining a safe medium for distributing copy-protected material, as that of the forthcoming holywood high-definition DVD distributions.
It seems that Bill Gates dreams for making windows the premium platform for entertainment playback, despite some recent EC setbacks, is now closest to fulfillment than ever.
Hackers Demonstrate Their Skills in Vegas
By GREG SANDOVAL, AP Technology Writer
1 hour, 14 minutes ago
Even the ATM machines were suspect at this year's Defcon conference, where hackers play intrusion games at the bleeding edge of computer security.
With some of the world's best digital break-in artists pecking away at their laptops, sending e-mails or answering cell phones could also be risky.
Defcon is a no-man's land where customary adversaries — feds vs. digital mavericks — are supposed to share ideas about making the Internet a safer place. But it's really a showcase for flexing hacker muscle.
This year's hot topics included a demonstration of just how easy it may be to attack supposedly foolproof biometric safeguards, which determine a person's identity by scanning such things as thumb prints, irises and voice patterns.
Banks, supermarkets and even some airports have begun to rely on such systems, but a security analyst who goes by the name Zamboni challenged hackers to bypass biometrics by attacking their backend systems networks. "Attack it like you would Microsoft or Linux," he advised.
Radio frequency identification tags that send wireless signals and that are used to track a growing list of items including retail merchandise, animals and U.S. military shipments_ also came under scrutiny.
A group of twentysomethings from Southern California climbed onto the hotel roof to show that RFID tags could be read from as far as 69 feet. That's important because the tags have been proposed for such things as U.S. passports, and critics have raised fears that kidnappers could use RFID readers to pick traveling U.S. citizens out of a crowd.
RFID companies had said the signals didn't reach more than 20 feet, said John Hering, one of the founders of Flexilis, the company that conducted the experiment.
"Our goal is to raise awareness," said Hering, 22. "Our hope is to spawn other research so that people will move to secure this technology before it becomes a problem."
Erik Michielsen, an analyst at ABI Research, chuckled when he heard the Flexilis claims. "These are great questions that need to be raised," he said, but RFID technology varies with the application, many of which are encrypted. Encryption technology uses an algorithm to scramble data to make it unreadable to everyone except the recipient.
Also on hand at the conference was Robert Morris Sr., former chief scientist for the National Security Agency, to lecture on the vulnerabilities of bank ATMs, which he predicted would become the next "pot of gold" for hackers.
The Internet has become "crime ridden slums," said Phil Zimmermann, a well-known cryptographer who spoke at the conference. Hackers and the computer security experts who make a living on tripping up systems say security would be better if people were less lazy.
To make their point, they pilfered Internet passwords from convention attendees.
Anyone naive enough to access the Internet through the hotel's unsecured wireless system could see their name and part of their passwords scrolling across a huge public screen.
It was dubbed the "The Wall of Sheep."
Among the exposed sheep were an engineer from Cisco Systems Inc., multiple employees from Apple Computer Inc. and a Harvard professor.
An annual highlight of the conference is the "Meet the Feds" panel, which this year included representatives from the FBI, NSA and the Treasury and Defense departments. Morris and other panel members said they would love to hire the "best and brightest" hackers but cautioned that the offer wouldn't be extended to lawbreakers.
During the session, Agent Jim Christy of the Defense Department's Cyber Crime Center asked the audience to stand.
"If you've never broken the law, sit down," he said. Many sat down immediately — but a large number appeared to hesitate before everyone eventually took their seats.
OK, now we can turn off the cameras, Christy joked.
Some federal agents were indeed taking careful notes, though, when researcher Michael Lynn set the tone for the conference by publicizing earlier in the week a vulnerability in Cisco routers that he said could allow hackers to virtually shut down the Internet.
Lynn and other researchers at Internet Security Systems had discovered a way of exploiting a Cisco software vulnerability in order to seize control of a router. That flaw was patched in April, but Lynn showed that Cisco hadn't quite finished the repair job — that the same technique could be used to exploit other vulnerabilities in Cisco routers.
Cisco and ISS went to court to try to stop Lynn from going public, but Lynn quit ISS and spoke anyway. In the wake of his decision, Lynn has become the subject of an FBI probe, said his attorney Jennifer Granick.
Many at the conference praised Lynn.
"We're never going to secure the Net if we don't air and criticize vulnerabilities," said David Cowan, a managing partner at venture capital firm Bessemer Venture Partners.
And the vulnerabilities are plenty.
During his session on ATM machines, Morris said thieves have been able to dupe people out of their bank cards and passwords by changing the software in old ATM machines bought off eBay for as little as $1,000 and placing the machines out in public venues.
Zen don't you mean steal his pants and kick him in the marbles? That's what the bashers here would lead one to believe.
Dave
CMF-I too think there is new buying coming in.
Some of it is probably pure speculation based on the ups of the past few days. I have to think there are a few funds also buying which we will see when the next institutional numbers come public. This is a big if here. If what we think has happened, happened, then this may be some buying by people that are connected with the companies that are using Wave in various ways. If the numbers are going to be what we have imagined they could, then Wave showing up where they haven't been in numbers-STM anyone-is sure to make those stock savy folks take note and at least do a little digging.
Dave
Solas- found it tonight
http://www.rednova.com/news/technology/180381/trust_the_chip_advantage/
Dave
Trust the Chip Advantage
Software-enhanced trusted PG platform solves many of today's security challenges.
New advances in PC hardware and software dramatically increase IT security and address some of the most common computer security challenges facing enterprise and government IT managers today. A better kind of PC, called a "trusted personal computer," is now available from a wide range of OEMs. In fact, tens of millions have already shipped.
A trusted PC looks just like a regular PC, and the costs are comparable. A trusted PC, however, comes with an embedded security chip that works with specially developed secure software-a powerful combo that enables the strongest data protection and authentication capabilities for your network.
The computer industry is now offering a variety of PCs and desktop boards equipped with this security chip, called a trusted platform module (TPM). Some of the better known models with this capability are made by Dell, IBM, HP, Intel and Fujitsu.
Specifications for the TPM have been developed and promoted by an industry standards organization called the Trusted Computing Group (TCG). Industry analysts estimate TPM security chips may be in nearly all computers by the end of the decade.
TPM security chips are nice, but they are not much use without accompanying software. Independent software vendors are addressing this issue by developing industry-standard security software optimized for the TPM security chip. The TPM security chip and associated software are designed to fit easily into your existing Microsoft-compatible infrastructure.
TPM software provides both client and server solutions that deliver enhanced data protection and enable strong authentication for access control and the ability to manage credentials created by the hardware. It provides data protection and strong authentication through the use of the TPM, which securely stores the critical keys that software uses to protect information.
On the server side, solutions provide the infrastructure to allow IT managers to securely store and migrate protected keys from one TPM-enabled system to another, according to security policies defined by the organization. Together, these client and server solutions enable a hardware-protected environment for access to networks, credentials and data.
The latest client applications provide a complete set of secure services. Most work with the Microsoft Office environment and are engineered to secure a variety of PC-related productivity tasks.
In enabling the trusted platform, users should make sure the software they choose provides a range of strong authentication capabilities involving multifactor authentication, and supports inclusion of passwords and biometrics. Authentication requirements to the machine, and thus to the network, are rooted in hardware, enhancing the trust of each user's access to information and services.
Passwords continue to be the most common form of authentication because of their ease of use. Reliance on static, reusable passwords, however, has proven to be a key vulnerability point. Password-management solutions should deal with both password protection and password replacement.
For password protection, TPM-leveraging software simplifies the sign-on process to Web sites and applications by using automated functions to save and supply practical or complex passwords. Passwords are protected by the TPM, yielding the security required when passwords alone are the sole method of authentication.
For password replacement, TPM-leveraging secure software controls access to TPM-secured applications by offering a master password replacement for individual TPM key passwords. The master password can be combined with a fingerprint, resulting in convenient two- factor authentication. For secure applications, the TPM functions as a third factor.
For remote access through virtual private networks, trusted PC software allows the TPM security chip to act as a token to replace, or exist alongside, the existing portable token solutions for remote access-at a fraction of the cost.
For more information from Wave Systems: http://www.wavesys.com/
TPM security chips are nice, but they are not much use without accompanying software.
Steven Sprague is president and CEO of Wave Systems Corp., based in Lee, Mass. A pioneer of the trusted PC movement, he has spoken and presented at more than 50 industry events. Send comments for publication to guest@comnews.com.
Lost Laptops Sink Data
LOST BACKUP TAPES may be the IT security issue du jour, but stolen laptops are a bigger and more intractable problem. Critical business data walks out the door every day on notebook computers. Increasingly, those devices are going missing.
Laptops are easy targets because of their portability. That makes restricting physical access all but impossible. Just recently, for example, two laptops stolen from a human resources service provider put the names and Social Security numbers of Motorola employees at risk [QuickLinka6480]. At Wells Fargo last fall, information on thousands of the bank's borrowers was compromised when three laptops were stolen from a subcontractor [QuickLink 50562]. In both cases, the data wasn't encrypted.
Therein lies another problem. All too often, logical security controls that could protect data simply aren't used. While encryption provides an obvious remedy for securing backup tapes in transit, there are no easy fixes for securing those very personal mobile computing devices - only trade-offs.
Encryption slows down performance, which may irritate power users. And employees may view biometric devices, smart cards and other access-control mechanisms as burdensome. Unfortunately, the people whose laptops have the most sensitive data tend to be the ones who have the least patience dealing with layered security.
Yet the consequences of inaction are increasingly public, thanks in part to the law known as California SB 1386, which requires companies to notify customers of data breaches within 48 hours. Had Wells Fargo required its subcontractor to encrypt all data, it wouldn't have had to notify customers of the theft.
Any machine that has the potential to hold sensitive data or e- mail should be encrypted. But don't bother with Windows XP's Encrypting File System. "If you know your Windows password, you know the keys to the hard drive. There are a lot of ways to hack that," says Clain Anderson, director of wireless and security at Lenovo.
Full disk encryption works better because it's transparent: Users don't have to be trained - and trusted - to save all their data in an encrypted folder. Most approaches use the Triple Data Encryption Standard algorithm to encrypt data, which is very secure. But the encryption keys still must reside on the disk. Some laptops, including some of Lenovo's ThinkPads, store this data on a security chip based on the Trusted Platform Module (TPM) standard.
"That gives you a gatekeeper so your passwords and digital certificates can be protected and aren't just laying around on the hard disk somewhere," says Anderson. If employees forget their password, they're locked out, but a separate administrator password can be configured for support purposes.
Seagate Technology has announced another option: hardware-level disk encryption, which is available with its new Momentus drives. The encryption key resides on a restricted area of the disk, so even if the drive is removed, a thief still can't boot the system or read the disk without the password. Both IBM and Dell are lining up behind the technology. But laptop vendors are unlikely to integrate the drives until a second supplier jumps into the market.
Smart cards are the best bet for additional access controls beyond the system log-in. Major laptop vendors already offer integrated card readers as an option. Biometric devices, in contrast, are more of a convenience feature for password management than a true security mechanism. For example, the ThinkPad X41 has an embedded fingerprint reader and encrypts the password database using the TPM chip. But while there's only a 1 in 10,000 chance that it will accept a wrong fingerprint, there's a 1 in 20 chance that it will reject a valid fingerprint. For systems without an integrated reader, add-on devices can cost $70 or more per system. "From a pure hardware-enablement standpoint, the cost is more than double for biometrics over smart cards," says Tim Gee, product marketing manager at Dell.
Among Dell customers, the adoption rate of smart cards is about 20%, compared with less than 5% for TPM and biometrics, Gee says. But lost smart cards can also be an annoyance for both users and the support personnel who manage them.
All of these technologies can add to management complexity and can be expensive to deploy at scale, cautions Gee. For protecting locally stored data, however, disk encryption will suffice. If an encrypted laptop is stolen, the perpetrators can't access the data or they can't use the machine unless they swap out the drive or reformat it. "The chance of them getting the information is so infinitesimally small that it isn't worth thinking about," says Anderson. Given how much IT already has on its plate, one less thing to think about is just what the doctor ordered.
A little Berger fix
Industry group pushes secure servers
Joris Evers
CNET News.com
July 25, 2005, 10:20 BST
The Trusted Platform Module has been proposed as a way of making data more secure
The Trusted Computing Group has released a specification for servers with a special security chip, which the industry group says will better protect data and transactions.
At the heart of the blueprint for "trusted servers" is the Trusted Platform Module, a chip that stores digital keys, certificates and passwords. The TPM is already used in PCs. More than 15 million "trusted clients" have been shipped by PC makers such as Hewlett-Packard and Dell, according to the TCG.
Computers with the security chip can wall off data, secure communications and identify systems belonging to the company or to business partners.
Servers that are built following the group's specifications will be less prone to attack, Brian Berger, chairman of the TCG's marketing working group, said in an interview. Critical data can be protected by hardware-based security, not by often-attacked and vulnerable software, he said.
"We are all aware of software issues with worms, viruses and vulnerabilities. Critical information is now protected by hardware that has very strong protection against access," Berger said. "Software vulnerabilities are really not seen in a hardware protection environment."
The TCG specification, released early this week, is available free to hardware makers. The trusted server blueprint supports a variety of processor architectures and various form factors. The first servers built according to the specification should be available by year's end, according to the TCG.
TCG members include server makers such as Dell, HP, IBM and Sun Microsystems.
Click here to read the TCG Generic Server Specification
UPEK Provides Biometric Fingerprint Security for the ThinkPad Tablet; Lenovo Expands Integration of UPEK Technology Across Notebook PC Product Line With Introduction of ThinkPad X41 Tablet
BERKELEY, Calif. --(Business Wire)-- July 25, 2005 -- UPEK(R), Inc., the leading supplier of biometric fingerprint security solutions, today announced that Lenovo has chosen UPEK's fingerprint authentication solutions to secure their ThinkPad* Series of notebooks with the introduction of the new ThinkPad X41 Tablet. Lenovo incorporated UPEK technology on select models of the ThinkPad X41 Tablet. UPEK delivered its TouchStrip(TM) fingerprint authentication solution with "dual-swipe" technology, which provides the user with the ability to swipe the sensor in either direction, complementing the unique display orientation flexibility of the tablet form factor. This feature enables the most convenient use of the sensor, independent of the orientation of the display.
UPEK's TouchStrip Fingerprint Authentication Solution enables secure sign-on and, in combination with Lenovo's ThinkVantage Client Security Solution allows users to replace multiple passwords with the swipe of a finger. The TouchStrip chipset also enables multi-factor authentication by working with the Trusted Platform Module, an industry standard security chip that is included on every ThinkPad Notebook PC with the TouchStrip Fingerprint Authentication Solution. With over one million TouchStrip and TouchChip(R) solutions integrated by leading notebook OEMs and ODMs, UPEK is the leading supplier of biometric fingerprint security to the notebook PC market.
"Lenovo's decision to continue integrating UPEK's biometric security solution supports their commitment to offering one of the most secure fingerprint platforms on the market today," stated Sapna Capoor, Industry Analyst at Frost and Sullivan. "Integrating fingerprint authentication into a tablet PC form factor will meet the growing demand for a higher level of security in industries such as healthcare which requires secure point-of-care access to patient information."
"We are pleased to expand our leading security solutions across the ThinkPad Series of platforms that started with the T-Series and have migrated to the flagship X-Series systems including this new tablet form factor," stated Alan Kramer, president and CEO, UPEK, Inc. "We see our existing customers continuing to leverage the unique capabilities of our secure authentication and management solutions across their product lines as market demand increases and our competitive differentiation becomes fully realized."
About UPEK
Headquartered near Berkeley, California, with offices in Prague, Tokyo, Singapore and Taipei, UPEK, Inc. is a privately-held biometric fingerprint security company launched as a venture-backed spin-off from STMicroelectronics in 2004. The security solutions offered by UPEK under the TouchChip(R) and TouchStrip(TM) brands have been shipping in volume since 1999 and have been integrated into a broad range of commercial and consumer applications. UPEK offers the full range of capabilities needed to deliver end-to-end solutions, including silicon fingerprint sensors, biometric algorithms, companion processors, and client/server software. For more information, visit www.upek.com
Ten Reasons towards Cryptography
Author: IT-Observer Staff
Monday, 25 July 2005, 20:26 GMT
Cryptography is already the de facto way of securing sensitive web traffic and it is now reaching across the entire enterprise as companies start to use industry-standard protocols such as SSL internally - even between servers only a few feet apart.
Below are nCipher’s top-ten reasons towards cryptography:
1. Inexpensive tokens for strong authentication - Using anything stronger than passwords for authentication has been prohibitively expensive for anything other than premium users; but market volumes and competitive pressures are now commoditizing authentication tokens and driving functionality up and prices down.
2. Ease of deployment for tokens - The arrival of USB tokens and the inclusion of card readers in laptops and keyboards is minimizing and sometimes removing deployment costs.
3. Trusted computing and trustworthy devices - Embedded security such as Trusted Platform Modules (TPM) provide a 'seat of trust' to authenticate devices as well as users.
4. Security standards with teeth - The Trusted Computing Group (TCG) is revolutionizing PC platform security while the Payments Card Industry (PCI) standards define an approach to data privacy and then back it up with audits.
5. Public key enabled applications are already here - While the 'year of PKI' never came, functionality based on public key cryptographic and digital certificates are now part of the IT fabric, supporting secure websites, email messaging, mutual authentication and document level protection.
6. Identity management isn't just about users - As well as just reducing the cost of forgotten passwords, identity management systems are now focused on provisioning devices as well as users across the enterprise, leading to easier roaming and fine-grained access controls.
7. Plug and play data level protection - Off-the-shelf solutions now exist to transparently encrypt valuable content within the database, filing system and storage fabric.
8. SSL everywhere - No longer limited to e-commerce connections, SSL is a ubiquitous feature of enterprise applications and networking, enabling almost any connection to be protected and removing the need to run expensive private networks.
9. No more cryptographic bottlenecks - Moore's Law means that high performance cryptographic accelerators can now meet the needs of the most demanding applications.
10. Cryptographic management for scalability - Advanced, automated solutions are being developed to manage ubiquitous cryptography and the growth in the number of keys, using specialist techniques to prevent security being compromised in the name of scalability.
More Nagravision
ExpressVu Implements New Anti-Piracy Measures
7/18/2005
--------------------------------------------------------------------------------
TORONTO - Bell ExpressVu is activating new signal encryption systems for its satellite TV service.
The company says over 92% of their subscribers have now received and installed the new upgraded SmartCards for the new encryption system, calling it "the company's most comprehensive initiative to date to combat the industry-wide issue of signal theft." Bell began distributing new conditional access SmartCards to new and existing subscribers last year in a effort to curb the piracy problem.
The current security system, an MPEG II DVB service developed by Nagravision, was breached more than five years ago. Echostar is currently involved in civil litigation in the United States against individuals believed to be responsible. DirecTV is also in litigation over satellite signal piracy, and has recently filed claim against a Canadian alledged to have broken terms of a permanent injunction against selling illegal satellite reception equipment.
The U.S. Dish Network system is also currently swapping out their more than 11 million subscribers to a new security smart card, dubbed "Nagra 2." Nagra 2 is a new encryption algorithm being introduced by Dish Network & Bell ExpressVu.
ExpressVu currently provides more than 400 channels of English and French television programming to its more than 1.5 million subscribers. The programming signal is encrypted for transmission to subscribers who are authorized to decode it upon payment using authorized satellite receiver and smart card technology.
E-mail to kiSS
From: David
Sent: 22. juli 2005 14:05
To:
Subject: Question about a former business relationship
Hello, I was curious as to wether there was still a relationship between your company and Wave Systems.
Thank you for your response.
Dave
Not to my knowledge
Best
Bo
Premire/Nagarvision/Wave?.............
Premiere Launches Innovative Video-On-Demand Service PREMIERE DIREKT+
-- First-class television: Order films at any time and watch them
immediately
-- Digital recorder with PREMIERE DIREKT+ can be rented for
EUR 14.90 per month
-- Receivers on sale in stores and directly from Premiere starting
June 24, 2005
-- Up to 30 films permanently on offer - Kofler: "PREMIERE DIREKT+
turns the living room into a video rental store"
MUNICH, Germany, June 23, 2005 (PRIMEZONE) -- Tomorrow, June 24, 2005, Premiere will launch PREMIERE DIREKT+, an exclusive video-on-demand service that will be available via a standard television set in your living room. PREMIERE DIREKT+ is based on a new generation of Premiere digital recorders (PDR) with an integrated digital receiver. The first recorder is supplied by Humax with the iPDR-9800, and will be on sale starting tomorrow in stores and directly from Premiere. PREMIERE DIREKT+ offers a selection of up to 30 films, updated on a weekly basis. The range of films includes top blockbusters, recent features as early as six months after their cinematic release, as well as explicit adult films. Classics such as I, Robot and Ocean's Twelve are loaded onto the hard drive of the new PDR overnight, and stored in several categories that give viewers a clear overview of the selection of movies. For a fee, viewers can then order the movie of their choice from the range on offer at any time via telephone, text message or Internet, and watch it immediately.
At first, PREMIERE DIREKT+ and the required PDR will only be available to subscribing households with satellite reception. The minimum requirement for access to PREMIERE DIREKT+ is the starter subscription package PREMIERE START. As Dr. Georg Kofler, CEO of Premiere AG, says, "Premiere turns the living room into a video rental store. PREMIERE DIREKT+ is a unique service that gets people interested in Premiere and digital television by providing films on the minute. The new PDR enables Premiere subscribers to watch movies on their normal TV sets whenever they want. It can't get any easier or more convenient. PREMIERE DIREKT+ is an innovation that strengthens Premiere's image as the top TV brand for premium entertainment. For television as a whole, a new stage of development has been reached--a mass medium has discovered the charm of individualization. With PREMIERE DIREKT+ and the new Premiere digital recorder TV viewing habits will change for many members of the public. In addition, TV will become interesting for a new group of viewers, who wish to actively choose their TV viewing to suit their individual tastes."
Trailers to all films at the push of a button / Up to 7 new films every week / Every film can be viewed for 24 hours
PREMIERE DIREKT+ is distinguished by its simple and easy to use PDR remote-controlled operation. The clear menu guide and the categories of "New, Action & Suspense", "Sci Fi & Fantasy", "Comedy & Romance" and "Blue Movies" make it easy to navigate through the choice of films. Alongside the brief synopses and details on the actors and genre, viewers can also view a short trailer for each film. And just like at the movies, PREMIERE DIREKT+ serves up new films every week: up to seven films are swapped into the selection every Thursday. Films can be ordered very simply via telephone, Internet or text message. Within 15 to 20 seconds of placing the order, the selected film is then available for viewing for 24 hours. Prices vary between EUR 2 (classic blockbusters), EUR 4 (current top films) and EUR 6 (explicit adult films). During the 24 hours that the film is at your disposal, it can be viewed any number of times, paused, rewound, fast-forwarded or viewed in slow motion action replay--as if it were a DVD, with all the advantages of digital television such as Dolby Digital, 16:9 and the option of watching it in the original language version. The films ordered are marked in the PREMIERE DIREKT+ menu with a green dot, and the time remaining for viewing the film is shown in hours.
Suitable for PREMIERE DIREKT+: New generation of Premiere digital recorders
The first Premiere digital recorder compatible with PREMIERE DIREKT+ is the Humax iPDR-9800. The recorder has a storage capacity of 160 GB, half of which is reserved for PREMIERE DIREKT+. Around 80 GB are available for the viewer's own use, which is enough to record up to 40 hours of television programs in broadcast quality. A timeshift function allows viewers to pause a program in mid-play, and continue watching at any time--even before the recording has finished--or jump to certain points in the recording. Two integrated tuners enable viewers to record a program on one channel, while watching a different program on another. The seal of approval "Geeignet fur PREMIERE DIREKT+" ("Suitable for PREMIERE DIREKT+") guarantees that the Humax iPDR-9800 can receive all Premiere's programming, including options such as the multifeed broadcasts of the new Premiere Sport portal. It also enables the timer-controlled recording of all programs on the portal.
Reduced purchase price from EUR 299 in combination with a Premiere subscription / Receiver rental for EUR 14.90 per month
Alongside Premiere, the receiver manufacturer, Humax, and the world's leading supplier of encryption systems, Nagravision, were involved in the technical development of PREMIERE DIREKT+. The combination of a video-on-demand service and a normal television set together with the full functionalities of a personal video recorder is worldwide unprecedented.
The recommended retail price of the HUMAX iPDR-9800 is EUR 499. In combination with a Premiere subscription, the recorder is available from EUR 299. Alternatively, starting August 1, all Premiere subscribers can also hire the HUMAX iPDR-9800 for EUR 14.90 per month (exception: subscribers of PREMIERE START / PREMIERE AUSTRIA).
This press release and other information is available on the Internet at info.premiere.de.
CONTACT:
Dirk Heerdegen, Vice President Corporate Communications
Company Spokesman
+49 89/99 58-63 50
dirk.heerdegen@premiere.de
Shane Naughton, Deputy CFO
Vice President Investor Relations
+49 89/99 58-1100
shane.naughton@premiere.de
Stefan Vollmer, Head of Financial and Business Communications
+ 49 89/99 58-63 77
stefan.vollmer@premiere.de
Christine Scheil, Director Investor Relations
+ 49 89/99 58-1010
christine.scheil@premiere.de
http://www.primezone.com/newsroom/?d=80429
NEC Electronics Introduces Secure Single-Chip MPEG Decoder for Set Top Boxes
Enhanced Security Features Prevent Piracy of Pay Television Broadcasts
KAWASAKI, Japan, SANTA CLARA, Calif., DUESSELDORF, Germany, June 2, 2005
To address the increasing piracy of broadcasts on pay television, NEC Electronics Corporation (TSE:6723) and its subsidiaries in Europe and the United States, NEC Electronics (Europe) GmbH and NEC Electronics America, Inc., today introduced a single-chip MPEG decoder (part number µPD61126) with enhanced security features for digital set top boxes (STB). By working closely with conditional access vendors, NEC Electronics has incorporated features specifically designed to prevent illegal reception and copying of pay television broadcasts and information stored in STBs.
The µPD61126 decoder integrates two MIPS32® 4KEcTM microprocessor cores capable of delivering speeds of up to 286 million instructions per second (MIPS) each. The decoder also offers an improved DDR-SDRAM interface, with speeds up to 333 megahertz (MHz) and memory up to 1 gigabyte (GB). An enhanced graphics engine provides designers with more flexibility to manipulate advanced graphics and data. The combination of these performance-enhancing features enables smooth operation of MHP (Multimedia Home Platform), outstanding speed in interactive MHEG applications (Mulitmedia and Hypermedia Experts Group), and integration of standard on-screen display functions.
An embedded USB 1.1 host interface permits connection to external devices such as cable modems or digital cameras, and direct support for DVB-CI (Digital Video Broadcasting-Common Interface) standards eliminates the need for external routing chips. In addition to these functions, the device has comprehensive power-management functions and a design process optimized for low-power operation. The µPD61126 decoder also enables maximum reuse of hardware and software components from field-proven devices to facilitate speedy migration from legacy devices.
"Piracy of digital broadcasts is a growing and costly issue for producers, content owners and broadcasters of television programming," stated Masao Hirasawa, general manager, Digital AV Systems Division, NEC Electronics Corporation. "The newest addition to our line-up of MPEG decoders provides an affordable single-chip solution designed to significantly limit such illegal activities."
The µPD61126 decoder is supported by a range of software and middleware, including reference designs, evaluation systems and a full suite of high-level application program interfaces (APIs) and wrappers that are compatible among all of NEC Electronics' digital AV devices. API and key middleware applications, including those based on MHEG and MHP protocols, will also be provided.
Pricing and Availability
Samples of the µPD61126 decoder are available today upon request and are priced at US$25. Volume production is scheduled to begin in early 2006. Pricing and availability are subject to change.
http://www.necel.com/en/news/archive/0506/0201.html
WAVX/kiSS from back in the day
WAVE SYSTEMS ANNOUNCES AGREEMENT WITH KISS NORDIC A/S TO BUNDLE WAVE’S E-COMMERCE SYSTEM WITH KISS NORDIC MULTIMEDIA PRODUCTS
KiSS Nordic to Deploy 500,000 Units in 2000, Offering European Consumers Access to Digital Content and Services on a Pay-Per-Use Basis
Hoersholm, Denmark, August 28, 1999 -- Wave Systems Corp., (Nasdaq: WAVX; http://www.wave.com), a provider of e-commerce, content distribution and security services, today announced an agreement to bundle Wave’s e-commerce system with products offered by KiSS Nordic A/S (www.kissnordic.dk), a leading supplier of multimedia products for personal computers in Europe. Under the terms of the agreement, KiSS Nordic will bundle Wave’s EMBASSY technology, in the form of a USB device, and Wave’s e-commerce content service, WaveDirect, on select models of its multimedia products. This agreement furthers Wave’s goal for mass distribution of its technology and e-commerce services, and provides customers with expanded options for content and services from Kiss Nordic’s multimedia products.
The WaveDirect service provides consumers with a convenient and flexible way to buy electronic content such as software and music at their desktop. KiSS Nordic customers will now be able to buy electronic content using a pay-per-use model, saving time and money through advanced secure transaction capabilities enabled by Wave’s EMBASSY technology.
"Partnering with Wave gives our customers a convenient, secure, and revolutionary tool for accessing and buying a wide range of software and digital content, positioning KISS Nordic to offer a very unique, innovative e-commerce capability while establishing a recurring revenue stream that grows beyond the initial product purchase," said Peter W. Christensen, Managing Director of KiSS Nordic A/S.
"Europe is a relatively advanced market for consumer devices and content usage models," said Laurence Blackall, Chief Executive of ITG. "We feel confident that the KiSS Nordic product line bundled with Wave’s security technology and content service will be received very well. Wave System’s trusted client security platform is an ideal solution for the fast growing trend of delivering PC technology to consumers as part of an integrated services and content offering."
"The debut of the WaveDirect service in Europe on KiSS Nordic’s multimedia cards, satellite receivers and PCs marks another key milestone for our company in the mass, global deployment of our multi-channel content distribution network," said Steven Sprague, President of Wave Systems. "We are on plan in deploying our technology, not just in the US, but also in the European market reaching millions of very savvy technology consumers."
About WaveDirect:
WaveDirect is designed to benefit consumers, PC and peripheral vendors, and content providers. Consumers benefit from flexible purchase options (pay-per-use, rent-to-own) and convenient at-home shopping for a wide variety of electronic content. PC and peripheral vendors directly benefit from an on-going revenue stream, access to new services and content for product value differentiation, and extended customer relationships. Content providers gain from secured copyright protection, flexible pricing options, and lower distribution costs.
WaveDirect users simply load the bundled CD ROM's, or other content received from WaveDirect, onto their PC and then follow the Windows-based instructions for registering and using the service. After their account is established, users are free to rent or buy any of the packaged software titles. When the consumer uses any of the titles, money is debited from their account based on their usage. Any amount of money spent in rental time is applied toward the total purchase price. Once rental payments reach the retail price, the software is owned outright.
Wave has been developing secure transaction and electronic content distribution technology for more than two years. WaveDirect is a tangible part of Wave's overall strategy to facilitate the secure distribution and sale of digital information by creating new transaction and purchasing models derived from client-based e-commerce technologies.
About Wave Systems Corp:
Founded in 1988, the mission of Wave Systems Corp. is to create the world's best technologies and services to secure and sell digital information. With the recently completed acquisition of N*Able Technologies, Wave now has a comprehensive line of trusted client co-processor systems. Wave's technology is an inexpensive, open standards, hardware and software-based device that enables secure transaction processing and distributed information metering in users' PCs. Embedded in PC hardware and peripherals, set-top boxes and other devices, Wave’s trusted client technology is the foundation for client-based security applications and a new distribution and purchasing model for content and services. This low-cost, secure "system within a system" will enable the personal computer to assume an important new role in the evolving digital economy. By moving secure transactions to the desktop, Wave provides intrinsic value to the electronic commerce process, benefiting PC users, application developers, and hardware manufacturers. For more information, please visit Wave's corporate web site at http://www.wave.com.
About KiSS Nordic A/S:
KiSS Nordic A/S was established November 1994 and is based in Hoersholm, Denmark. In less than 5 years, Kiss Nordic A/S has established itself as one of the leading suppliers of multimedia products in Europe with special focus on CD-ROM, CD-R, CD-RW, video accelerators and DVD/DVB. For more information, please visit the KiSS Nordic A/S web site at http://www.kissnordic.dk.
Safe Harbor for Forward-Looking Statements:
Except for the statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the ability to fund operations, the loss of market share, changes in consumer buying habits and other factors over which Wave Systems Corp. has little or no control.
KiSS Nordic to Bundle Wave Systems' USB Smart Card Readers in its Line of Multimedia PC Products Starting This Fall
European Consumers Gain Access to Digital Content and Services as KISS NORDIC Bundles EMBASSY Enabled Device with its Products
London, UK, and San Jose, CA - May 15, 2000 -- KiSS Nordic A/S (www.kissnordic.dk), a leading supplier of multimedia products for personal computers in Europe, today announced it will incorporate USB Smart Card Readers by Wave Systems Corp. (Nasdaq: WAVX) into its fall line of products.
KiSS Nordic had previously announced that it will deploy EMBASSY enabled USB devices. Today's announcement reflects KiSS Nordic's choice of EMBASSY deployed in a USB smart card reader, with a bundling program. Wave's secure e-commerce smart card reader will be bundled with KiSS Nordic's Multimedia PC products. KiSS Nordic will also promote the WaveDirect service to its growing customer base, offering a convenient, flexible way to buy digital content such as software and music at the desktop. KiSS Nordic made the announcement at the MediaCast 2000 tradeshow in London, where Wave Systems and Kiss Nordic are demonstrating this secure e-commerce technology and service, from May 15th through 17th.
Wave Systems is a provider of electronic commerce, content distribution and security services. Under the agreement Wave Systems' USB smart card reader, powered by EMBASSY secure e-commerce technology, will be bundled with KiSS Nordic's wide array of PC products. The device in combination with the WaveDirect service allows consumers to acquire and try content before deciding to make a purchase. Consumers also gain a variety of options for purchasing digital content right at their desktop, including free preview, pay-per-play, rent-to-own, and outright purchase.
"We intend to bundle Wave's USB smart card reader and promote the WaveDirect service with all of our multimedia products. We understand what the revolutionary combination of EMBASSY's secure e-commerce capabilities and the WaveDirect service can mean to our customers and to KiSS Nordic. Our customers gain security at the desktop and an innovative way to access and purchase content and KiSS Nordic gains a recurring revenue stream that extends beyond the sale of our product," said Peter W. Christensen, Managing Director of KiSS Nordic A/S.
"Through our agreement with KiSS Nordic we continue to expand our relationships in Europe. We look forward to working with a strong partner who shares our vision of a growing network of EMBASSY enabled devices as a platform for the secure distribution and sale of digital products," said Steven Sprague, President and CEO of Wave Systems. "Bundling our device with KiSS Nordic's multimedia product line is important in our plans to speed deployment of our secure e-commerce technology and distribution services across Europe."
About Wave Systems
Founded in 1988, Wave Systems Corporation is a content distribution and secure services company based on a new distributed trust model for e-commerce. Wave's core EMBASSY(TM) technology is an open, standards-based hardware and software device that enables secure transaction processing and distributed information metering in users' PCs. Embedded in PC hardware and peripherals, set-top boxes and other devices, EMBASSY(TM) is the foundation for client-based security applications and a new distribution and purchasing model for content and services. This low-cost, secure "system within a system" will enable the personal computer to assume an important new role in the evolving digital economy. By moving secure transactions to the desktop, Wave provides intrinsic value to the electronic commerce process, benefiting PC users, application developers and hardware manufacturers. For more information, please visit Wave's corporate web site at http://www.wave.com.
About KiSS Nordic A/S
KiSS Nordic A/S was established November 1994 and has in less than 5 years established itself as one of the leading suppliers of multimedia products in Europe with special focus on CD-ROM, CD-R, CD-RW, Video accelerators and DVD/DVB. The management team and a Danish industrial group own the company.
Safe Harbor for Forward-Looking Statements
Except for the statements of historical fact, the information presented herein constitutes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include general economic and business conditions, the ability to fund operations, the loss of market share, changes in consumer buying habits and other factors over which Wave Systems Corp. has little or no control.
Fiserv Reports Continued Strong Earnings for Second Quarter of 2005
http://www.tmcnet.com/usubmit/2005/Jul/1165856.htm
the below is from a different press release here:http://www.tmcnet.com/usubmit/2005/Jun/1160044.htm
The joint Wave-Efficient Forms solution will first be deployed at Fiserv Investment Support Services (Fiserv ISS). Fiserv ISS' customers, in financial services and brokerage applications, will use interview-style, interactive forms and legally-binding and standards-compliant electronic signing capabilities. Fiserv ISS is a business unit of Fiserv Inc. (NASDAQ:FISV).
If this can move into other parts of this company here wow, 6 month revenue 0f 1,795,000,000
BROOKFIELD, Wis. --(Business Wire)-- July 21, 2005 -- Fiserv, Inc. (Nasdaq:FISV) announced today continued strong earnings for the second quarter of 2005.
Net income per share-diluted from continuing operations for the second quarter of 2005 was $0.59 per share, compared to $0.49 per share for the second quarter of 2004. Processing and services revenues were $913.1 million, an increase of 10% over the second quarter of 2004.
For the six-month period ended June 30, 2005, Fiserv processing and services revenues were $1,795.4 million, a 9% increase over the first six months of 2004. Net income per share-diluted from continuing operations (excluding realized gain from sale of investment of $0.14 per share) was $1.17 per share compared to $0.97 per share for the first six months of 2004.
"We are very pleased with our results for the first half of 2005, posting record revenues and earnings along with strong operating margins in our businesses. Our financial segment internal revenue growth rate was 6% for the first half of 2005, which is a solid improvement over the prior year 2% growth rate," said Leslie M. Muma, president and chief executive officer of Fiserv.
During the second quarter, Fiserv completed three acquisitions. Fiserv acquired the assets of the U.S. eLending operations of Emergis, Inc. (TSX:EME), which provides mortgage lenders the tools that will enable them to more easily obtain an array of Fiserv and third-party services needed to process, close and fund mortgage loans via the Internet and provides the capability to manage, electronically sign, and store mortgage documents in a secure electronic environment. The second acquisition was Interactive Technologies, Inc., a developer of fee management and billing software for large and mid-sized financial services organizations. The latest acquisition was Administrative Services Group, Inc., a regional employee benefits plan administrator.
In the first half of 2005, Fiserv repurchased 6.5 million shares of common stock, and in July, the Board of Directors authorized the repurchase of an additional 10 million shares of the company's common stock, bringing the total remaining shares available for repurchase to 10.8 million.
OUTLOOK FOR THE THIRD QUARTER AND FULL YEAR
Fiserv has updated its earnings and revenue outlook for the third quarter and the full year. For the third quarter of 2005, processing and services revenues are estimated to be approximately $905 to $925 million and net income per share-diluted is estimated to be $0.53 to $0.56.
Based on the strong results through the second quarter, Fiserv is raising its full year 2005 estimated net income per share-diluted earnings (excluding realized gain from sale of investment of $0.14 per share) to a range of $2.24 to $2.28 from a range of $2.19 to $2.23.
Internal revenue growth rates for the full year 2005 are projected to be in the mid-single digits in the Financial and Investment segments and upper single digits in the Health segment.
RENEWED AND NEW CLIENT RELATIONSHIPS
Significant client renewals and other new relationships gained in the second quarter include the following: World Omni Financial Corp., one of the nation's largest auto finance companies, licensed the LeMans Loan Origination System to manage its Toyota Auto Finance portfolio in the Southeast U.S., as well as its CenterOne third-party servicing division portfolio across the entire country; the Washington State Health Care Authority agreed to renew its contract with the Harrington unit of Fiserv Health to administer benefits to state employees for four years effective Jan. 1, 2006; Credit Union On-Line (CUOL), a Waltham, Mass.-based credit union service organization representing $2.9 billion in assets, selected Fiserv XP Systems to provide the XP2 information system to the CUOL client base; CoopDesarrollo, Mexico's sixth largest credit union, will be one of the first Mexican credit unions to comply with new Mexican government regulations by using the ICBS core banking system from Fiserv's CBS Worldwide unit; Aequitas Capital Management selected Fiserv Credit Processing Services' PLUS System to provide selected hospitals and healthcare providers with a turnkey consumer medical finance program; and Merchants Bank, a $1.1 billion-asset bank based in South Burlington, Vt., expanded its already significant relationship with Fiserv to include check processing services.
EARNINGS CONFERENCE CALL
An analyst conference call to review the second quarter results will be held Friday, July 22 at 9:00 a.m. Central time. A live webcast of the call will be available to the public on the Fiserv Web site at www.fiserv.com.
USE OF NON-GAAP FINANCIAL INFORMATION
The Company reports its financial results in accordance with GAAP. However, the Company uses certain non-GAAP performance measures, including free cash flow, internal revenue growth, adjusted operating margin and adjusted earnings per share, to provide investors a more complete understanding of the Company's underlying operational results. These non-GAAP measures are indicators management uses to provide additional meaningful comparisons between current results and prior reported results, and as a basis for planning and forecasting for future periods. As an example, the Company uses adjusted earnings per share to present the impact of certain transactions or events that management expects to be infrequently occurring, such as the realized gain on sale of investment occurring in the first quarter of 2005. We believe this adjusted measure is more indicative of the Company's operating performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for comparable metrics prepared in accordance with GAAP in the United States.
ABOUT FISERV
Fiserv, Inc. (Nasdaq:FISV) provides information management systems and services to the financial and health benefits industries, including transaction processing, outsourcing, business process outsourcing and software and systems solutions. The company serves more than 16,000 clients worldwide, including banks, credit unions, financial planners/investment advisers, insurance companies and agents, self-insured employers, lenders and savings institutions. Headquartered in Brookfield, Wis., Fiserv reported $3.4 billion in processing and services revenues for 2004.
Fiserv was ranked the largest provider of information technology services to the U.S. financial services industry in the 2004 FinTech 100 survey by the American Banker newspaper and the Financial Insights research firm. Fiserv can be found on the Internet at www.fiserv.com.
The disclosures in this press release contain forward-looking statements, specifically statements regarding the estimated earnings per share-diluted for the third quarter and full year of 2005, revenue outlook for the third quarter of 2005, internal revenue growth rates for the full year 2005, expected contract termination fees in the second half of 2005, expected software license revenues for the second half of 2005, estimated flood claims processing volumes for the second half of 2005, reduced net investment income in the Investment segment for the second half of 2005 and an expected negative impact on Financial segment revenues, primarily in 2006. These statements are covered by the safe harbor included in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to inherent assumptions, risks and uncertainties that may cause actual results to differ materially from those contemplated by such forward-looking statements. The factors that may cause actual results to differ materially from those contemplated by the forward-looking statements include, among others, changes in customers' demand for the Corporation's products, pricing and other actions by competitors, and general changes in economic conditions. These factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. -0- *T FISERV, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (1) (In thousands, except per share amounts) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2005 2004 2005 2004 --------- --------- ----------- ----------- Revenues: Processing and services $913,095 $829,842 $1,795,414 $1,641,398 Customer reimbursements 83,331 89,931 174,126 187,252 --------- --------- ----------- ----------- Total revenues 996,426 919,773 1,969,540 1,828,650 --------- --------- ----------- ----------- Cost of revenues: Salaries, commissions and payroll related costs 348,693 324,569 692,177 654,155 Customer reimbursement expenses 83,331 89,931 174,126 187,252 Data processing costs and equipment rentals 54,054 53,584 105,432 105,689 Prescription costs 131,085 108,807 255,181 204,385 Other operating expenses 146,872 134,031 279,194 261,068 Depreciation and amortization 45,146 46,939 88,169 92,851 --------- --------- ----------- ----------- Total cost of revenues 809,181 757,861 1,594,279 1,505,400 --------- --------- ----------- ----------- Operating income 187,245 161,912 375,261 323,250 Interest expense - net (1,280) (4,486) (4,942) (9,218) Realized gain from sale of investment (2) - - 43,452 - --------- --------- ----------- ----------- Income from continuing operations, before income taxes 185,965 157,426 413,771 314,032 Income tax provision 71,968 61,331 160,129 122,228 --------- --------- ----------- ----------- Income from continuing operations 113,997 96,095 253,642 191,804 Loss from discontinued operations, net of tax - (1,061) (619) (3,972) --------- --------- ----------- ----------- Net income $113,997 $95,034 $253,023 $187,832 ========= ========= =========== =========== Diluted net income (loss) per share: Continuing operations (excluding realized gain from sale of investment) $0.59 $0.49 $1.17 $0.97 Discontinued operations - (0.01) - (0.02) --------- --------- ----------- ----------- Total (excluding realized gain from sale of investment) 0.59 0.48 1.16 0.95 Realized gain from sale of investment - - 0.14 - --------- --------- ----------- ----------- Total $0.59 $0.48 $1.30 $0.95 ========= ========= =========== =========== Diluted shares used in computing net income (loss) per share 193,227 197,379 194,361 197,221 (1) The securities clearing businesses' revenues and cost of revenues are excluded above from "Revenues" and "Cost of revenues" and are included in "Loss from discontinued operations, net of tax" for all periods presented, as these businesses were sold on March 24, 2005. (2) Represents the sale of the Company's remaining 3.2 million shares of Bisys Group, Inc. common stock. FISERV, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in thousands) (Unaudited) June 30, December 31, 2005 2004 ------------ ------------ ASSETS Cash and cash equivalents $566,579 $516,127 Accounts receivable - net 473,897 437,764 Prepaid expenses and other assets 102,231 100,810 Investments 2,151,974 1,984,536 Property and equipment - net 202,338 200,709 Intangible assets - net 543,300 532,539 Goodwill - net 1,915,900 1,859,347 Assets of discontinued operations held for sale - 2,751,517 ------------ ------------ TOTAL $5,956,219 $8,383,349 ============ ============ LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable $220,079 $202,616 Short-term borrowings 100,000 100,000 Accrued expenses 285,422 363,513 Accrued income taxes 50,607 44,955 Deferred revenues 221,684 226,080 Customer funds held and retirement account deposits 1,886,369 1,829,639 Deferred income taxes 136,517 134,330 Long-term debt 490,659 505,327 Liabilities of discontinued operations held for sale - 2,412,467 ------------ ------------ TOTAL LIABILITIES 3,391,337 5,818,927 SHAREHOLDERS' EQUITY Preferred stock, no par value: 25,000,000 shares authorized; none issued - - Common stock, $0.01 par value: 450,000,000 shares authorized; 197,455,044 and 195,940,360 shares issued 1,975 1,959 Additional paid-in capital 719,470 679,573 Accumulated other comprehensive income (loss) (2,623) 26,695 Accumulated earnings 2,173,562 1,920,539 Treasury stock, at cost, 8,162,700 and 1,691,500 shares (327,502) (64,344) ------------ ------------ TOTAL SHAREHOLDERS' EQUITY 2,564,882 2,564,422 ------------ ------------ TOTAL $5,956,219 $8,383,349 ============ ============ FISERV, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) Six months ended June 30, 2005 2004 ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net income $253,023 $187,832 Adjustment for discontinued operations 619 3,972 Adjustments to reconcile net income to net cash provided by operating activities: Realized gain from sale of investment (43,452) - Deferred income taxes 11,210 36,997 Depreciation and amortization 88,169 92,851 Changes in assets and liabilities, net of effects from acquisitions and dispositions of businesses: Accounts receivable (24,720) 843 Prepaid expenses and other assets 620 (8,394) Accounts payable and accrued expenses (24,873) (9,386) Deferred revenues (7,714) 466 Accrued income taxes (3,200) 24,041 ------------ ------------ Net cash provided by operating activities 249,682 329,222 ------------ ------------ CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures, including capitalization of software costs for external customers (69,640) (68,885) Payment for acquisitions of businesses, net of cash acquired (135,654) (40,918) Proceeds from sale of businesses, net of expenses paid 303,944 - Cash distribution received from discontinued operations prior to sale 68,000 - Investments (173,518) (281,571) ------------ ------------ Net cash used in investing activities (6,868) (391,374) ------------ ------------ CASH FLOWS FROM FINANCING ACTIVITIES: Repayments of long-term debt - net (14,845) (210,571) Issuance of common stock 28,911 20,508 Purchases of treasury stock (263,158) - Customer funds held and retirement account deposits 56,730 282,458 ------------ ------------ Net cash provided by (used in) financing activities (192,362) 92,395 ------------ ------------ Change in cash and cash equivalents 50,452 30,243 Beginning balance 516,127 162,668 ------------ ------------ Ending balance $566,579 $192,911 ============ ============ FISERV, INC. AND SUBSIDIARIES SELECTED FINANCIAL AND SEGMENT INFORMATION (1) (In thousands, unaudited) Free Cash Flow Six Months Ended June 30, 2005 2004 ------------ ------------ Net cash provided by operating activities $249,682 $329,222 Capital expenditures, including capitalization of software costs for external customers (69,640) (68,885) ------------ ------------ Free cash flow $180,042 $260,337 ============ ============ Free cash flow is measured as net cash provided by operating activities less capital expenditures including capitalization of software costs for external customers, as reported in the Company's condensed consolidated statements of cash flows. Free cash flow is a non-GAAP financial measure that the Company believes is useful to investors because it provides another measure of available cash flow after the Company has satisfied the capital requirements of its operations. Three Months Ended Six Months Ended June 30, June 30, 2005 2004 2005 2004 --------- --------- ----------- ----------- Processing and services revenues: Financial institution outsourcing, systems and services ("Financial")(2) $632,096 $580,155 $1,240,583 $1,154,660 Health plan management services ("Health") 246,283 218,260 487,368 424,851 Investment support services ("Investment") 34,716 31,427 67,463 61,887 --------- --------- ----------- ----------- Total $913,095 $829,842 $1,795,414 $1,641,398 ========= ========= =========== =========== Operating income: Financial (2) $160,157 $138,904 $320,305 $277,451 Health 18,867 17,978 41,133 36,628 Investment 8,221 5,030 13,823 9,171 --------- --------- ----------- ----------- Total $187,245 $161,912 $375,261 $323,250 ========= ========= =========== =========== (1) The securities clearing businesses, sold on March 24, 2005, are not included in the segment results. (2) Included in the Financial segment results are early contract termination fees of $22.0 million for the six months ended June 30, 2005, compared to $19.4 million for the comparable period in 2004. These clients were acquired by other financial institutions and represent a small portion of Fiserv's more than 6,000 core financial institution processing clients. This segment's businesses generally enter into three- to five-year contracts with their clients that contain early contract termination fees. These fees are very unpredictable and these fees can vary significantly from period to period based on the number of terminated contracts and how early in the contract term a contract is terminated. The Financial segment's total early contract termination and assignment fees were $12.3 million and $4.6 million in the third and fourth quarters of 2004, respectively. FISERV, INC. AND SUBSIDIARIES INTERNAL REVENUE GROWTH PERCENTAGES BY SEGMENT (1) (Unaudited) Three months ended Six months ended June 30, June 30, -------------------- -------------------- 2005 2004 2005 2004 -------------------- -------------------- Financial 7% 1% 6% 2% Health 10% 50% 12% 46% Investment 10% 12% 9% 5% -------------------- -------------------- TOTAL 8% 11% 8% 10% -------------------- -------------------- Pro forma (2) Pro forma (2) Three months ended Six months ended June 30, June 30, -------------------- -------------------- 2005 2004 2005 2004 -------------------- -------------------- Financial 7% 1% 6% 2% Health 4% 14% 4% 12% Investment 10% 12% 9% 5% -------------------- -------------------- TOTAL 7% 3% 6% 3% ==================== ==================== (1) Internal revenue growth percentages are measured as the increase in total processing and services revenue for the current period less "acquired revenue from acquisitions" divided by total processing and services revenues from the prior year period plus "acquired revenue from acquisitions." "Acquired revenue from acquisitions" was $13.8 million ($8.1 million in the Financial segment and $5.7 million in the Health segment) for the second quarter of 2005 and $23.9 million ($13.0 million in the Financial segment and $10.9 million in the Health segment) for the six months ended June 30, 2005, and represents pre-acquisition normalized revenue of acquired companies, less dispositions, for the comparable prior-year period. The securities clearing businesses, sold on March 24, 2005, are not included in the internal revenue growth percentages by segment. (2) The pro forma internal revenue growth percentages exclude the positive impact of the prescription cost which is included in both revenues and cost of revenues in the Health segment. Actual and pro forma internal revenue growth percentages are non-GAAP financial measures that the Company believes are useful to investors because they provide a breakdown of internal and acquisition-related revenue growth including and excluding prescription costs in revenue. *T
Outlook for Full Year
Based on the strong results through the second quarter, Fiserv is raising its full year 2005 estimated net income per share-diluted earnings (excluding the one time realized gain from sale of investment of $0.14 per share) to a range of $2.24 to $2.28 from a range of $2.19 to $2.23. Fiserv reported net income per share diluted for the first six months of 2005 of $1.17 from continuing operations (excluding the one-time realized gain from sale of investment of $0.14 per share.)
The net income per share-diluted guidance for the second half of 2005 is lower than the first half of 2005 actual results primarily due to the following factors:
-- Contract termination fees in the first half of 2005 were $22 million and are expected to be much lower in the second half of 2005, excluding a large termination fee that is expected to be paid in either the fourth quarter of 2005 or first quarter of 2006 (see third paragraph of Segment Results on page 11);
-- Software license revenues were particularly strong in the first half of 2005 and are forecasted to return to more normalized levels in the second half of 2005;
-- Flood claims processing volumes were exceptionally high in the first half of 2005 and should return to historical levels in the second half of 2005; and
-- The Investment segment net investment income is expected to be lower in the second half of 2005 as the segment's cash investment balances were unusually high during April and May of 2005 and had returned to more normalized levels starting in June.
Segment Results
Financial Segment: The Company's largest operating segment, the financial institution outsourcing, systems and services segment ("Financial"), continued its strong operating performance during the second quarter of 2005 with processing and services revenue growth of 9% and operating income growth of 15% compared to the second quarter of 2004. On a year to date basis, the Financial segment increased processing and services revenues by 7% and operating income by 15% over the prior year period. For the first half of 2005, operating margins in the Financial segment were 26% compared to 24% in the prior year comparable period. Fueling the strong operating margins in the first half of 2005, compared to 2004, were increased software license revenues and higher than normal flood insurance claims processing revenue (both of which generate higher incremental margins), along with continued cost synergies from previously completed product consolidations.
The internal revenue growth rate for the Financial segment was 7% for the second quarter of 2005 and 6% on a year-to-date basis, both increasing over the respective prior year comparable periods. The biggest contributors to the increased 2005 internal revenue growth rate in this segment were increased volumes in the lending division's loan settlement services businesses, incremental revenue associated with the newly signed Australian check processing business that began operations in mid-April, continued strong software license revenues and higher-than-normal revenues associated with one-time flood insurance claims processing.
Financial segment revenues, primarily in 2006, will be negatively impacted by approximately $40 million due to changes affecting three client relationships. One client is in the process of being acquired, a second client transitioned from an outsourced solution to license Fiserv software, and a third client plans to convert from an outsourced solution to an in-house solution.
Early contract termination fees due to client acquisition by other financial institutions of $7.1 million were recognized in the second quarter of 2005 compared to $5.1 million in the prior year second quarter. On a year to date basis, early contract termination fees were $22.0 million in 2005 compared to $19.4 million in 2004.
Health Segment: The Health plan management services segment ("Health") processing and services revenues increased 13% and operating income increased 5% in the second quarter of 2005 compared to 2004 and on a year-to-date basis processing and services revenues increased 15% and operating income increased 12%. The Health segment operating margin, excluding the impact of prescription costs, was 16% in the second quarter of both 2005 and 2004 and on a year-to-date basis was 18% in 2005 compared to 17% in 2004.
The pro forma internal revenue growth rate, which excludes the positive impact of the prescription cost that is included in revenues and cost of revenues, was 4% in the second quarter and on a year-to-date basis in 2005. The decrease in the second quarter and year-to-date 2005 internal revenue growth rates compared to 2004 was primarily due to significant growth of the pharmacy services businesses in early 2004 based on the signing of some very large clients. In addition, growth of the health plan administration businesses has been negatively impacted by increased competition in the large commercial employer market.
Investment Segment: The Investment support services segment processing and services revenues increased 10% and operating income increased 63% in the second quarter of 2005 and on a year-to-date basis processing and services revenues increased 9% and operating income increased 51% compared to the prior year periods. Operating income increased in the second quarter of 2005 compared to the prior period due primarily to a temporary increase in cash investment balances that improved net investment income and continued new client growth, especially in the custody and trading services for registered investment advisors.