In Box

Digital Hancocks

When the European Directive on Electronic Signatures was launched in 1999, it was hailed as a major step toward widespread implementation of e-signatures — encryption technology used to authenticate the content of a document and verify its creator. But only Germany and Austria complied. Then, in June 2000, then U.S. President Bill Clinton used an ...

When the European Directive on Electronic Signatures was launched in 1999, it was hailed as a major step toward widespread implementation of e-signatures — encryption technology used to authenticate the content of a document and verify its creator. But only Germany and Austria complied. Then, in June 2000, then U.S. President Bill Clinton used an electronic smart card to sign the Global and National Commerce Act (E-Sign) into law. The step made e-signatures, which are more difficult to forge than those in ink, legally binding in America. At the time, proponents envisioned an e-business boom. Disappointingly, nothing much happened.

Today, digital signatures seem to be undergoing a rebirth. Governments seeking lower costs and increased efficiency are leading the way. In March, U.S. Energy Secretary Spencer Abraham (www.energy.gov) used a digital signature to send President George W. Bush a nuclear waste proposal, the first time a U.S. cabinet-level official digitally signed a formal recommendation to the president. The move reportedly saved his department nearly $1 million in copying and paper costs. In February, Bermuda’s Ministry of Telecommunications and E-commerce (www.mtec.bm), in an attempt to attract e-businesses to the island, set out to issue "dig sigs" to its entire population of 63,500 by year’s end. And in January, the German government (www.bundesregierung.de) enacted legislation giving digital signatures to all of its federal employees, more than 200,000 in all.

These steps are being encouraged by a group of private-sector firms that stand to make billions from e-signature technology. VeriSign Inc. (www.verisign.com) and Entrust (www.entrust.com) are two examples. Abraham used VeriSign’s technology to send the digital memo to Bush. "As more governments become standardized on… digital signature technology, it will become easier for world leaders to interact electronically in a secure manner," says an Entrust spokeswoman. But critics like People for Internet Responsibility (PFIR) (www.pfir.org) say the devil is in the details. "What happens typically is that you have a mechanism like this that people think is reliable and trustworthy, but because of the underlying infrastructure it’s put on — the Internet, for example — it’s always vulnerable to attack," says PFIR cofounder Peter G. Neumann. It appears the ink on this issue hasn’t dried just yet.

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