FB

I know this has been a very successful year for Daon. Can you please provide our readers with an update on some of your recent news from 2004, such as TWIC and Registered Traveler?

DAON

Sure! 2004 was a very significant year for the whole industry and also one for Daon. There were two very coveted contracts in our industry for Identity Assurance and Identity Management. One was the US Registered Traveler program, which was significant in the sense that it was the first time that the domestic US traveling public ever used biometrics for authentication and it was also voluntary. Daon won that contract mid-year as a subcontractor to UNISYS. The rollout started in June 2004 and it was extremely well received. It had a very positive reaction both by the TSA, the Department of Homeland Security and the traveling public. The second contract, which was very much a marquee contract for the Department of Homeland Security, was the TWIC contract. Daon was awarded that contract as a sub-contractor to BearingPoint. That contract has proceeded just flawlessly on plan and it is operational at ports on both coasts of the United States and has also received great support from the Department of Homeland Security. Those are two of the most coveted, very high profile contracts for the US Government.

FB

To continue on the TWIC program, you mentioned that the rollout was going well – there were two airports and all the ports in Florida involved in that –is that correct?

DAON

Yes – Florida was a state that had a very progressive intent to implement this kind of a credentialing system so, in addition to the other ports that are part of the program, Florida had a broader initiative. Regardless of the long term plans for TWIC roll-out nationwide Florida has passed legislation to permanently use biometric technology for all transport workers at their ports.

FB

And how is that going?

DAON

It is going very well. The TWIC system is an excellent system – very high quality – very robust and very secure. It is receiving significant attention across government. You may be aware of the HSPD-12, the Homeland Security Presidential Directive, that is designed to strengthen national security systems, coming up with common identification standards for Federal employees and contractors and TWIC is being looked at as a deployed system that has many of the common capabilities that HSPD-12 would require.

FB

Could we talk a little bit more about the Registered Traveler Program? You mentioned a very interesting point, and that is, it is really the first time that the public, in large numbers, has been exposed to biometrics. Is there any feedback available yet on this exposure, and what are the next steps with regard to that program?

DAON

Sure – a good question! Let’s see – the first airport that was deployed was Minneapolis and I was up at the press conference where there were probably 30 reporters and camera crews in Minneapolis interviewing travelers. We opened the kiosk for enrolment at about 5:30 in the morning, and at 4:30 in the morning travelers were there eager to get enrolled in the system. The interviews with people, the discussions with the travelers were extremely positive as has been the reaction to the program ever since. The program has been a very positive public relations event for TSA and especially convenient for the travelers. To give you the perspective from a traveler’s point of view, you would come up to a kiosk and you would, either through a fingerprint scanner, have your fingerprint read or through an iris scanner, authenticate your identity. The traveler and their preference determine the technique. It is very fast, very convenient. The traveling public response to it has been overwhelming. We had to cap enrolment and turn people away. Some people had driven over two and a half hours to enrol and we just had reached the limit of how many people were planned to be part of this pilot and we had to turn away numerous people. The travelers have really like it!

FB

What is the timing now for the next steps in this program?

DAON

The program is now extended to the end of September2005. The next steps are to make these airports interoperable, which would be bringing together the different locations so a traveler could travel from one registered traveler location to another and use their credential and authenticate their identity rather than how it is currently set up only within their home airport. Then the government is looking at different ways to enrol registered travelers throughout on a broader basis at additional airports as 2005 progresses.

FB

I would like to get more specific about your products and particularly the DaonEngine – why has the DaonEngine been so successful in the marketplace, and what differentiates it from others in use in your competitive fields?

DAON

The DaonEngine and our products have a reputation for being very, very flexible and very secure in protecting the privacy of all biometric or biographic information that is stored in our platform. We have high availability in terms of the design because if you are going to run a registered traveling lane or a border crossing or any important business application, availability becomes extremely important. Then the ability to scale – many of these programs start off as small pilots and then they enjoy success, similar to what Registered Traveler would do and you may start off with a couple of thousand participants but then if you envision having another six hundred million plus passenger flights throughout the United States you obviously want to be able to support the large demand without having a series of false starts having to rebuild the system. Our product supports that whole path, that whole life cycle, which is extremely important.

FB

Is that a key differentiator – the fact that that scalability exists?

DAON

Absolutely! It is an important differentiator. Another important differentiator in the Registered Traveler program was its flexibility. The Registered Traveler program had to be rolled out, by contract, about 5 days after contract award with a lot of media attention. If you were to Google search “Register Traveler”, you would have about 750,000 hits – so it is a project with a very high profile. We had to roll out the first site at Minneapolis with a different concept of operation than was originally envisioned and we had to have the flexibility with the product to do it correctly – to not have to write any custom software code. We never changed a line of code in the Daon products. Moving on to Los Angeles we again had a different concept of operations. Then we went to Houston and we had yet again, a different concept of operations! Some involved smart cards, some involved just a token and in others there was no credential at all. We had three completely different concepts of operation, which allowed us to test different business processes without having to modify or write custom software.

FB

That says a lot about your product that it can be that flexible in high profile, rapid deployment scenarios.

DAON

Homeland Security has over 60 different credentialing projects underway because everybody responding is looking at biometrics as a strong form of authentication. This is also true around the world and what happens is that you have this pilot and you want to evaluate certain things and then the pilot becomes successful because the technology worked well and then you want to roll it out to potentially tens of millions of people. At that point you cannot go back to ground zero and rethink it. One of the big appeals of the Daon technology is to be able to go from a pilot stage to full large-scale deployment and preserve your investment.

FB

During our 2004 Year In Review where we spoke to 33 Biometric leaders, including Daon, it became clear that most felt that 2004 was a very good year for the industry and that the prospects for 2005 were also good. Can you comment on that?

Daon

I think that 2004 was a good year for the industry as a whole. The interest and movement towards using biometrics as a strong form of authentication has occurred around the globe. We were favoured by a lot of very good press and interest and I feel we crossed a major hurdle in 2004. Now the question is, how do you most successfully deploy this technology in a responsible manner and try to future-proof all deployments so that the investment can be protected. I think that there has been a huge step taken forward for this industry in 2004.

FB

Thank you Tom for your time today.

Daon

My pleasure.

Read more about Daon: www.daon.com

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