The business of digital identity
How much did this sort of Web explosion really influence your business?
Well, it's the reason I think this business is a spin-out separate company from RSA. [RSA president] Jim Bidzos realized as the Web was taking off and companies like Netscape were asking for security solutions. He could not grow a digital ID business fast enough internally. RSA had been issuing digital IDs since as early as 1986, but in volumes measured in thousands per year.
I think the Web explosion made security a paramount concern and it required that an infrastructure be built very, very quickly to support widespread use of authentication technology. So the Web has everything to do with why we're here and why it has grown so fast.
Do you ever worry that you've missed your opportunity here? VeriSign was the first with digital IDs and certificates. Now everyone wants to compete with you, including GTE Government Services and even the U.S. Postal Service.
We have been first to market with every significant introduction of digital ID products, whether it was digital IDs for servers, digital IDs for consumers, or digital IDs for software publishers so they can sign their code and you can be assured that it came from Microsoft or from Lotus. You'll see us roll out digital credit cards first. So our strategy is very simple: Be first to market and execute. We already have twice the number of people as GTE does in this particular business, and we'll double it again in 1997. This isn't an offshoot business for us; it's all we do. History has proven that if you focus and you execute to a key plan in a market where there is a lot of demand, you can be a winner.
What's the next thing for VeriSign?
One of the things that has fascinated us is how broadly applicable what it is we're doing is to moving the Web to that next generation of commerce. We see a lot of vertical market specialization for ourselves. Today, we're mostly focused in financial services with the credit cards, the banks, and the brokerages. We see health care as a huge opportunity, mostly in terms of benefits management and administration. There's a lot of work going on to allow you to access all of your 401(k) information or your payments records with doctors and dentists and the like through your health care plan, but over the Internet.
There is a lot of business to be done in publishing. We believe that subscription services is a model that will pan out for a lot of Web sites that are providing content. So in fact, folks like the Wall Street Journal and others are starting now to use subscription services. Well rather than a password and log-in to get into your services, you'll probably use a digital ID issued by a publisher to get all of your various services and your tailored information, tailored ads, or even tailored news stories.
You've seen a lot of start-up companies from the inside. Is it different doing an Internet start-up?
An interesting thing we talk about a lot here is, can we maintain the pace that we're all on? And not just VeriSign, but all of us, whether it's Microsoft, Netscape, or any other company doing this. The pace is phenomenal. It's never been said that Silicon Valley is a bunch of laggards or slackers. We've worked 12- to 14-hour days for as long as I can remember.
What it's doing in this particular space, is forcing us all to work together. And that's something I don't think people have talked about. The fact that you can't do it all yourself in these time-compressed periods, where you have to deliver an Internet service or product, forces you to go outside and align yourself with a VeriSign or align yourselves with a Visa or the rest. So we find ourselves being asked into more and more opportunities than we ever thought we would, because the people that are providing these new services need what we do and realize that if they can get it for us at a cost-effective price, why re-invent it?
What about your competitors?
I would claim there isn't going to be another start-up to compete with VeriSign. We're well in the lead. With the RSA technology that we inherited that's in some cases eight and ten years worth of development plus now over a year and a half's lead on the Internet, I think it would be very hard for a venture firm to fund a company to compete with us. I do believe, however, you'll see big players like a GTE or Postal Service take technologies that they've developed for other uses and try to commercialize them. GTE, for example, is a military contractor. It wants to move into the commercial space. So I think you'll see large system integrators, mostly with government contractor backgrounds, trying to get in and do what we do. They will have bigger names and probably more financial credibility than we do. I think what we'll have is execution credibility, in terms of having done this time and time again over the last few years.
And the Postal Service?
I'll actually make a statement I probably haven't made before: I expect us to work with the Postal Service in a lot of ways. The Postal Service is focused in one area, which is secure messaging using their services and using something they call a digital postmark, which gives you a legal time stamp when a piece of electronic mail passes through their systems. A digital signature will be legally binding, as will a time stamp on top of it of when the transaction occurred. Those things are going to be important for doing things like signing legal contracts on the Web.
We think that we could work with them in some of those applications, and we're having some initial discussions with them. We also think that if they went off and competed with us in just the secure email area, we've got a lot of other things we're doing in digital credit cards and digital bank books and the like. So it's a very, very large market. We want other players in it because we think with more players it gives more credibility to the overall security and trustworthiness of this digital ID infrastructure.
NEXT: The feds
