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December 2007 • Volume 12 Number 12
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Executive Director's Letter
Well, it is hard to believe I am writing “a year in review” letter for 2007 already. It seems like just yesterday that I was putting my thoughts together on the significant opportunities 2007 might have in store for the Smart Card Alliance. If you are curious, you can look back at the January 2007 issue and see what I had to say about the upcoming conferences we were planning and the exciting work that was in store for our Industry Councils (Identity, Transportation, Contactless Payments, Physical Access, and Healthcare). The enthusiasm I felt last January has, today, been replaced with pride for the accomplishments achieved over the year. Our success can be gauged in countless council conference calls, in-person meetings, conference events, web seminars, education programs, and publications that the smart card industry organization and our dedicated industry leaders delivered in 2007. Besides boasting about these Alliance activities, I want to talk about some of the biggest issues our North American industry faced over the last twelve months, and the Alliance response to these challenges and opportunities. I will focus on only three of these major issues from 2007. The first issue relates to the ongoing Federal government HSPD-12 activity and rollout of the federal employee ID, called the PIV card, and the need to help federal agencies and their physical access security departments understand the requirements for migrating their systems from the legacy ID badges currently in use to the new smart card-enabled IDs. After many delays and a few missed deadlines, full scale production seems imminent. Our Physical Access Council developed a series of white papers and partnered with other security industry standards and support organizations (SIA, OSE and IBIA) to create industry-wide guidance for federal administrators and their security suppliers to follow. NIST has incorporated key elements of these guidelines in its upcoming publications. The second issue also involved the Federal government, but centered around border crossing credentials and a proposed convergence with state-issued driver’s licenses (related to REAL ID Act legislation) to comply with federal laws enacted under the Western Hemisphere Traveler Initiative (WHTI) for land/sea border crossings for those citizens without valid U.S. passports. The Department of Homeland Security and U.S. Customs and Border Protection have steadfastly stuck with their choice of using less secure, long-range RFID tags instead of the more commonly used proximity contactless smart cards for the trusted traveler programs. This put the Smart Card Alliance in the uncomfortable position of vigorously opposing DHS’s border initiatives, while supporting other DHS homeland security programs affecting port workers (TWIC), first responders (FRAC), and registered travelers (RT). The Alliance hired a government communications expert to work with our Identity Council to develop new educational materials and effective messaging strategies for briefings with the media and legislative staffers. We also produced numerous reports and position statements outlining the risks of RFID and educating people about the advantages that smart cards provide for secure identity credentials. We have been joined by other security experts and privacy advocates in denouncing the use of RFID technology in the Enhanced Driver’s License, which will serve as a substitute for passports to prove traveler identity and citizenship at land and sea borders by 2009. The Alliance's efforts have not changed the hearts and minds of the DHS officials responsible for the WHTI initiatives, but our message has surely been heard and a new dialog has begun. History will determine if these efforts eventually bear fruit – or if our worst fears of insecure travel documents will be realized. The third issue pertains to the payments industry, where an estimated 30 million contactless credit and debit cards have been issued and more than 55,000 merchant acceptance locations are in place. Payment cards, coupled with the expansion of transportation use of contactless fare payment cards led by Boston, Washington, DC, New York, Atlanta, Salt Lake City, and San Francisco, have become the big story this year. Also, we are beginning to see results from the initial pilots that show how the payments industry is coming to grips with the enormous opportunities that can be made possible with the convergence of transportation payments, mobile devices powered by NFC technology, and contactless merchant acceptance. The Contactless Payments Council and Transportation Council memberships have been engaged in raising awareness of these potential partnerships and bringing industry stakeholders together in a series of conferences and web seminars, as well publishing guidelines for how merchants, mobile operators, transit agencies and financial institutions can benefit from the advances in contactless payments technology and applications. For the first time in the long history of smart cards, the United States is leading in the area of global adoption of contactless payments and we are seeing other countries following the U.S. lead and starting to implement their own solutions. With the diversity of opportunities and issues in the public and private sectors of our markets, both from the payments side of the business as well as the security side, I see a very exciting year ahead in 2008. To meet these challenges and address the expected changes in the markets in 2008, the membership base for the Alliance needs to continue to grow and diversify across all of these segments, so that no technology is left out, no innovative solution goes undiscovered, no market opportunity is overlooked, and no smart card issuer or end user is left wanting. If you are not part of this organization’s future today, you should be. Join the Alliance! To all of our members and friends, I wish everyone a Merry Christmas or other holiday expression of your choice – and a Happy New Year. Randy Vanderhoof
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