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[FYI] (Fwd) FC: Zero Knowledge, after poor software sales, tries new

------- Forwarded message follows -------
Date sent:      	Wed, 01 Nov 2000 11:40:59 -0500
To:             	politech@politechbot.com
From:           	Declan McCullagh <declan@well.com>
Subject:        	FC: Zero Knowledge, after poor software sales, tries new gambit
Send reply to:  	declan@well.com


    Privacy Firm Tries New Gambit
    by Declan McCullagh (declan@wired.com)
    2:00 a.m. Nov. 1, 2000 PST

    WASHINGTON -- Zero Knowledge Systems seems to have finally
    realized a harsh truth: Internet users don't like to pay extra to
    protect their privacy.

    The Montreal-based firm won acclaim for its sophisticated
    identity-cloaking techniques, but very few people appear to have
    paid the $49.95 a year to shield their online activities from
    prying eyes.

    That's not exactly a heartening prospect for a company with 250
    employees to pay and $37 million in venture capital funds to
    justify -- especially when already high-strung investors have
    become nervous about Internet companies that have never made a

    Zero Knowledge's solution: A kind of privacy consulting service it
    announced on Tuesday. Through it, the company hopes to capitalize
    on the growing privacy concerns of both consumers and businesses
    -- and, most importantly, finally enjoy some revenues.

    "This is a new focus for Zero Knowledge: helping businesses build
    in privacy technologies in how they deal with customer data flow,"
    Austin Hill, co-founder and chief executive, said in a telephone

    "As customer expectations have increased with privacy, and how
    governments have started to regulate some privacy standards ...
    all of a sudden, companies are having to think, 'Hold on, how do I
    build in privacy?'" Hill said.

    Hill and his staff of technologists -- including veterans like
    cryptologists Stefan Brands and Ian Goldberg -- aren't alone in
    eyeing the privacy-consulting business as a lucrative one.

    Many of the established consulting businesses such as
    PricewaterhouseCoopers and Ernst and Young offer privacy services.
    IBM launched such a business in 1998, and an Andersen Consulting
    representative says that privacy awareness is "a component of
    almost anything we do."


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