Secure travel documents, e-Passports, visas, driver’s licenses, national ID cards, and government logical and physical access badges have been deployed to date in small numbers. Currently there are over 30 e-Passports and approximately 30 National ID card initiatives underway worldwide.
The US Enhanced Border Security and Visa Entry Act of 2002 required that all machine readable e-Passports accepted for entry into the US issued after October 26, 2006 require encrypted smart card chips, or encrypted high resolution 2D barcode containing data from the front page of the passport and a digital image of the passport holder. The 188 countries belonging to the International Civil Aviation Organization (ICAO), a UN agency, agreed in July 2005 that all member countries must start issuing machine readable biometrically enabled e-Passports. The ICAO standard specifies Common Biometric Exchange File Format (CBEFF) as the globally interoperable biometric for identity verification in travel documents. Thus e-passports will contain digitally signed photographic images of the faces of their bearers. The ICAO standard additionally specifies fingerprints and iris data as optional biometrics.
The industry is on the cusp of a huge expansion in revenues for the right firms. Raj Nanavati, Partner, the International Biometric Group, gave a keynote speech at the Biometrics for Access Security conference. He made a number of interesting points among those he estimated the revenues in the Biometric Industry to be up from $1.85Bn in 2005 to $4.64Bn in 2008.
This growth is becuase governments today are under increased pressure to implement new security systems not only because of external security threats but also because of increased democratic pressure to improve and optimize communication and citizens’ access to its services.
So where should we be searching for these investment opportunities?
We have taken a great interest in the area and have concluded that all may not be as it seems. What I mean by that is the recieved wisdom is to look at the large companies that already operate in the market place and look to them to consolidate what we have found to be a fragmented industry. However here is the problem we have found with that strategy;
The main advantages of the big boys is, of course, financial strength of, strong government lobby support, strong marketing, representative enterprises all over the world and established customer base. This may be your benchmark for investing in these companies. The weaknesses we see, however, outway this usual assumption.
- small departments for R&D and low innovation due to their politics of little investment and risk taking in the R&D process,
- utilizing only already established technologies that are often not up to par with new and innovative solutions.
- their expert teams are focused and specialized in separate fields and they are not capable of maintaining R&D with the long term commercialization process.
- they are acting more as system integrators and financing suppliers then innovators.
As a company we have concentrated on smaller operations that have innovative R&D departments, high levels of management skill and expertise in their field and a track record of implementation of high level projects for goeverments or organisations.
We are in the position now of backing two companies in the sector CoreBIoID Inc and 123ID Inc for which we will be seeking funding partners as we move forward with the project.
CoreBioID Inc (www.corebioID.org)
CoreBioID Inc. is a leading provider of trusted identity enrollment, issuing, manufacturing and management systems, with demonstrable expertise in government document projects, eGovernment solutions, Enterprise solutions and Financial industry.
The Company develops sophisticated software and hardware solutions to address all phases of secure data acquisition, authentication, verification, personalization, production, issuance, integration, communication and data process management for electronic identification (“e-ID”) based on a Smart Cards and RFID Smart Cards. Its target markets revolve principally around government-issued identification documents and banking products (ePassports, driver’s licenses, health cards, bank debit/credit cards, etc.) with significant growth potential in both areas, as evidenced by its successful implementation of two of the world’s foremost sophisticated e-Passport initiatives, it ranks among an elite group of companies capable of meeting the latest compliance standards with respect to document security. CoreBioID has developed and implemented technology exceeding the most rigorous identity protection standards as set forth by the 188 countries belonging to the International Civil Aviation Organization (“ICAO”). Management is confident in its ability to build a leading market share in forthcoming years. With a presence in Europe and North America, one of the most advanced integrated solutions in the world and a world-class R&D organization, the Company is strategically positioned to compete on a global basis.
The Company’s revenue is earned as prime contractor on smaller projects and as subcontractor on larger ones, alongside leading prime contractors such as G&D GmbH (www.gi-de.com), Unisys (www.Unisys.com) and Muhlbauer ( www.muhlbauer.com ). Management believes that additional funding could enable CBID to become prime contractor on significant contracts and in so doing, achieve substantially higher top line and margin growth. Also, through additional funding, the company believes that it can expand its relationship with prime US and Canadian contractors such as Bell, Telus, Bearing Point, Lockheed Martin and Accenture.
The company has completed high level government projects and has increased revenue and profits an average of 14% over the last 3 years, year on year, with exponential growth projected on the back of pipeline projects over the coming years.
123ID INc (www.123id.us)
Over the last five years the Company has invested all its resources into research and development. From technological design and implementation to patent applications, this period is considered to be a preparation phase in anticipation of the official sales and marketing stage of the technology and the Company itself. Incredibly, even though not intended, the relationship process with future clients began early in the R & D phase as the technology and the Company was slowly being introduced into the marketplace.
Although overall a new entity in the marketplace, 123ID has a long list of references and impeccable reputation developed from historical projects, along with established relationships. Combined with its recent partnerships with corporations such as Novel, Fujitsu, SigTec, Triad and many more, the Company has a head start in its introduction in the marketplace.
123ID has worked with and secured customers through its partners in each of the following vertical markets:
This has been achieved by slowly capturing market share based on pure technological advantages and customer and technical service.
123ID is recognized in the biometric industry as a market leader in the verification of a person’s identity using primarily captured finger print images, complimented by other biometric verification technologies and overall interoperable integration.
Some of the achievements include compliance with the United States government’s National Institute of Standards and Testing [“NIST”], in live finger print recognition. The testing addresses the capability of reading millions of finger prints in a short period of time without erroneously accepting a single false print. - Zero tolerance for error. 123ID ranked near the top of the testing chart for this measurement.
123ID provides two layers of inter-operability. First with finger scanners [readers], 123ID can unify biometric data coming from a multitude of readers providing different source data, thus standardizing the hardware much like printers in a Microsoft Windows environment. Secondly different readers can be connected to a database from different locations whereby a person’s identification can be verified. Enrollment of a person for identification purposes can be minimized to a single enrollment point for access control, PC log on, and security simultaneously.