Interview with Mike DePasquale, CEO, BIO-key and

Hemant Mardia, CEO, IDEX

Conducted by Peter O’Neill, Mobile ID World

MIDW: The mobile ID market is hot. IDEX and BIO-key just signed a license agreement to deliver advanced biometric solutions for this market, please tell us about this news?

Mike: Yes Peter, certainly the entire mobility space is very hot right now as traditional technologies like PC’s and desk top computers are going away.  We are finding that not only enterprise users, but consumers are utilizing these devices for virtually everything that they access in the way of information and soon to be transactions like mobile payments, banking and access to health care records. As this evolves, security is both an impediment and an opportunity.  Biometrics are a way to not only secure devices, but secure access to information. BIO-key has provided, for many years a software platform for access to information using any fingerprint sensor that is available on the market. IDEX on the other hand is one of the leading innovators in developing finger sensor technology that not only can be very accurate and powerful but also low cost. Teaming and providing the best software platform technology with the best of fingerprint sensor technology is what this relationship is all about. So collaborating to bring the most advanced technology to the market, to the mobile handset players, to the OEM’s, to the tablet manufacturers, to all those device manufacturers that may incorporate more advanced security, that is our objective.

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Hemant: Thanks Mike, that is really a good overview and I’d like to add to what Mike has described. From what I see in the marketplace, clearly the reason why the Mobile ID market is hot is the adoption by Apple of a fingerprint sensor as a biometric solution. I think that is an important point to dwell on, in the sense that they did their due diligence, they have spent many years working in the space leading to a decision that they needed to acquire that technology in-house. That shows the level of commitment and expectation and strategic importance that fingerprint sensing has in what they see as the mobile ecosystem. Apple being unusual, being a fully vertically integrated company, sees the complete gamut of possibilities starting from the basic level which is user convenience and simplicity by avoiding the need for PIN’s and passwords; particularly on mobile devices. As Mike said, I think mobile payments are clearly one area that is exploding in terms of the amount of transactions that will be carried out on a mobile device which is enabled through various internet giants. Again, the key thing is having unique identification and authentication on the mobile device for the first time. Apple has set the tone for that because as we all understand, Apple has control of the full ecosystem from the basic hardware all the way through to the applications and they control the application space having access to such a large number of users. It sets a very interesting precedent and what we have seen is that following the launch of the iPhone 5S the demand from all of the other major OEM’s has accelerated exponentially. The reason why for me the BIO-key relationship with IDEX is very important is what the infrastructure players, what the handset players really need is a biometric solution and they don’t have the in-house biometric expertise so they are relying on companies like ourselves and BIO-key to come and offer them a solution that is going to provide a combination of convenience, cost and security that will work for them in their environment. That is an important fact that we are seeing biometrics and fingerprint sensors becoming mainstream providing a really good user solution. And that involves heavy integration between ourselves and a fingerprint sensor company, BIO-key is the software and system provider and the end customer in our case the handset vendors. So this is why I felt we were really looking for a teaming where we had companies and expertise and experience from different spaces that needs to now converge. The convergence that I see is consumer biometrics with enterprise and people like high end like governmental biometrics. That overlap is enabled by very low cost fingerprint sensors. That is the other step change that has happened. If you look pre-Apple the cost of a biometric really was probably prohibitive to be put onto wide scale consumer devices. Now we are in the few dollar range. That is a huge leap for the industry because at that level we can see ubiquitous deployment; there is no reason why you wouldn’t deploy it across the whole ecosystem. From a user prospective they can have complete interoperability and this is something in terms of the bigger picture on where the industry is heading that we want to be at the forefront of and I think what we set out as a program with BIO-key is really exciting because it will allows us to really bring the different pieces of the jigsaw together.

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MIDW: Well you have raised several very interesting points Hemant that we agree with at Mobile ID World. You mentioned enterprise solutions. There is a demand for flexible solutions that can blend into existing enterprise operations. How will you be addressing this area?

Mike:  I think that was a very strong consideration as IDEX and BIO-key evolved this collaboration arrangement because two things; number one enterprises have been accepting and adopting the use of biometrics over a number of years. In healthcare for example there is a significant proliferation of the use of biometric technologies for electronic prescribing, access to health records, we have call centers utilizing our technology for access to consumer files; but also keep in mind the largest enterprises around the globe service consumers. So consumer access to that enterprise information, for example checking your cell phone bill with AT&T, or Verizon or Orange or Airtel, thus there is a convergence for the use of this technology “consumer to enterprise” and then within the enterprise but it is all coming together as Hemant described in the ecosystem that is evolving around mobility. But I would also like to make one other comment; it’s not just mobility access. With the internet of things and the evolution of machine to machine communications and when I say that I mean everything from adjusting the temperature in your home or your refrigerator or access to your car, all of these things are interconnected today and security, because of this electronic interconnection, is a significant issue and concern but also opportunely for biometrics and for the collaboration between IDEX and BIO-key.

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MIDW: Hemant why is the IDEX Smartfinger Sensor so well suited for the mobile device market?

Hemant:  That is a good question; IDEX is founded around the idea of a low cost sensor that could be applied into mobile type of devices. Since IDEX was founded in ’97, IDEX has been at the forefront of the patent filing and generation of new IP to provide a very low cost but high quality fingerprint sensor solution. What that has led to over the many years is that IDEX has a pretty unique approach to the fingerprint sensor itself. I’m sure you are familiar with fingerprint sensors principles; today the principle has been evolved to a RF capacitive principle which gives the highest degree of performance. It allows sensing into the finger beyond just the surface of the finger it allows and incredible levels of sensitivity and that means in an everyday environment where you are applying a device into a mobile phone, which is a fairly harsh environment, you need a high quality sensor to be repeatable and also to be applied across a large population. IDEX has achieved probably one of the highest performances and we characterize that in terms of the signal integrity and I think Mike can vouch for this. What we find exciting is that BIO-key have access to large databases and are able to evaluate different fingerprint sensors and when they evaluated the results from our sensor I think it surpassed pretty much everything else that they had seen. So we’re very comfortable that we have had strong validation and that the quality of the fingerprint information that we generate is high because of the principles that we have patented. That goes further to the second point that the performance has to be good but in a mobile environment cost is also extremely critical for mass deployments. In order to get down to the sort of levels where you can deploy in very large numbers if we look at swipe sensors and touch sensors the market would like to introduce touch sensors, but in historical times the touch sensor is about a $15-30 part. We believe we can provide a touch sensor for a few dollars and that is using the fact that our sensor principle can use a very small silicon IC combined with a very cheap material. That two part sensing structure that we have, we believe that we are only one of two companies in the world that can currently offer that. Even Apple Authentec, their solution, is an all silicon solution and that means that the cost of the Apple sensor, the cost itself is known to be around $7-10 and that is just a cost level before manufacturing so that is prohibitive for many applications. So the combination of the two things that we have; best in class performance, we have good algorithms and that is part of the reason driving the BIO-key and IDEX collaboration is to continue to develop better algorithms, which are specifically aimed at extracting the best performance in a mobile device. Which is very challenging; a mobile device has a number of problems that you don’t see in other devices. For example, first of all if you are putting a sensor into a mobile phone the aesthetics is incredibly important so our sensors have to be coated and colorized to match into the aesthetics and the ID of the phone. That coating degrades the sensor and these are issues that we have been adapting our solutions and technology for. So when we come to a mobile environment the challenges have actually increased. We are also challenged by the fact that there is limited real estate on the mobile phones today. Even though the screens are going bigger the available space for sensors is actually diminishing and again IDEX’s sensors are very compact and we can adapt the form factor because of this two part solution. We can actually customize our sensors to meet all kinds of different handset manufacturers’ requirements. If you think about all the handsets, if you look at Samsung or you look at LG or you look at Apple, they all have a distinctive look and feel that they require to maintain their brand. I think this is very exciting for IDEX because we together with BIO-key can provide completely tailored solutions.

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MIDW: Multifactor solutions are also in demand, what are the drivers behind this demand and how will this union of your two companies address this?

Hemant: Great question! I agree a really core question. When I started in IDEX a year ago people kept saying to me, “What happens when people put iris on or voice recognition or visual?” And I said that doesn’t worry me, I think it is a good thing. What I see is that fingerprint is a good cornerstone for authentication but if you want to achieve very high levels of security, that is going to be needed, then multifactor is the way to go. Any system that relies on only one methodology is never going to be as secure as people would like but multifactor is a fantastic solution because you can then triangulate between different biometrics or different authentications and create a huge increase in security. So for me I always maintain that this is the future but having a low cost fingerprint sensor which gives a false accept rate in the order of 1 in 100,000, 1 in 50,000 type numbers and then adding to that a second or third authentication is a fantastic way forward. Again that is what attracted IDEX to work with BIO-key; because BIO-key has already launched an initiative with InterDigital around multifactor authentication and they intend on bringing this into the mainstream.

MIDW: Mike, can I get your take on this question?

Mike: Very eloquently stated by Hemant, clearly one of the benefits of our collaboration is also the extension of our work with InterDigital as Hemant mentioned. We built a multifactor authentication solution with them that utilizes not only our fingerprint biometric technology but other factors including for example the secure SIM on the device itself. The device identification number that is associated with the carrier, password, PIN we can utilize knowledge base technology; we’ve incorporated that into our core Web-key product offering. For example smart questions that can be answered. So we have multiple factors of authentication that depending upon the risk of the transaction can be utilized. Therefore,  as Hemant mentioned we will secure not only the ecosystem but the experience for the user and make it simple depending upon the critical nature of accessing the information or transaction that is being consummated.  We can use different factors and we can mix and match them and we even have algorithms today to determine that level of risk and what ultimately should be used and applied in that experience. So it is absolutely the way of the future, there is no question about that.

MIDW: Thank you gentlemen for describing the partnership that you have established. It seems like a very, very good fit for both parties and it also seems to address a lot of the needs and demands in the marketplace right now as we are moving forward quite rapidly as was also mentioned. I want to thank you very much for taking the time to speak with us today.

Learn more by visiting www.bio-key.com and www.idex.no