Hi 4321,

what is making me mad is that i think you are trying to create an expectation amongst naive folks that wave may be a beneficiary of the transaction income flow or some other model that is really in your dreams and not something wave is saying at all. that it can participate in the 3% of every transaction that is peeled away by the merchant card issuers, banks etc, for instance.

ss* has made it clear, albeit from the unsafe harbour, that wave is focussed on the enterprise access/communications opportunity. that is, they are thinking about the enterprise network. so the money they will be making is those fixed fees per seat.

but you keep directing the conversation away from that towards the transactional gold mine you hope to see via the tee.

there's just no way that is going to happen. actually, let me rephrase that. there's a 0.0000001% chance that is going to happen. the incumbents are going to bag the transaction fees. they are not dumb. this is what the whole architecture discussion is about. not efficiency and technology.

as you read the discussion from the mnos saying we don't want to be simply a bitpipe, that is what they mean. they intend to be a part of the flow of transactions.

the cost of the chips is neither here nor there to the folks who control the financial chain. that's a cost consumers will have to bear so that the banks, MNOs etc can keep control of the cash flow.

only potential exception is that wave's patent may enable it to muscle in on the distribution of trusted applets.

you presume these folks are dumb because they can't see the technological efficiencies of a universal interoperable system. but that's precisely what the incumbents want to exclude until they control the transaction chain.

ms is nobody in the mobile market at the moment. it'll take them 5 years to displace RIM in enterprise. global platform is an organisation for the handset makers and you just ignore the point that the handset makers and the mnos have been in competition architecturally for years, with the mnos consistently having things their way. i'm watching the MNO forums (eg gsma), the banks and the card issuers - and i suppose the retailers as well to see if they adopt your model. but it's a far safer presumption that they will continue along with their own.

*quotes:

"We also demonstrated in the February timeframe at RSA our solution of trusted platform module running on an ARM trust zone processor in partnership with trusted Logic which is a group with Gemalto. And the combination of companies were able to show a trusted computing capability that would do both identity and health of the device connected into a cloud service And I think this really shows the future of where hardware security can be in every handset and really provides a mechanism for the enterprise to have a key that they can secure within hardware of the actual handset. And so whether it's for access to email or access to cloud services, finally there's an effective way for the enterprise to have access control capabilities that can't be stolen or propagated by a user. So this will become one of the more powerful capabilities in the mobile market.

The addition of trusted computing to the mobile architecture, it's really an effort that's being led by Microsoft in the marketplace today with their requirement for TPM on all Windows on ARM platforms. And I think that we'll expand. The demonstration that we did was running on Android and ultimately it's a capability we would like to see in all mobile devices.

So Wave has an established team in that space. We are contributing to the standards in it. We are building a number of solutions in that area to really show the full capability of trusted computing on a handset and we intend to be one of the forefront players in the mobile marketplace. We will continue to demonstrate progress over the course of this year and I think this is an area where some people have asked me, so when will we see revenue from the first mobile device? I think revenue from actually selling a mobile device with trusted computing on it is a 2013 event. However, we have seen very strong interest from our enterprise customers.

We were, for example, at a very large customer the other day, one with more than a couple hundred thousand seats, and they clearly understand the opportunity to have trusted computing turned on on all their PCs and that that infrastructure will then work with trusted computing as it shows up within the handset environment. And one of the to-do items we left that meeting with was writing the specifications for them so that they, when they ask their suppliers to supply them with mobile devices, can require the trusted computing devices as part of their mobile platforms going forward. And I think that's really an excellent way to see where we play an important role where it's an opportunity for revenue in the enterprise for us today against turning on their PCs and getting that infrastructure ready and hopefully motivating those companies to turn on more infrastructure sooner. As well as our ability to impact the customer demand into the mobile marketplace so that you see not only us push from the supply side, but also demand pull from the enterprise side. We've been at this for a long time and the last thing we want to do is see half a billion mobile phones shipped and still nobody has turned them on. I think the nature of this business now is we're reaching a tipping point where having the PCs broadly deployed, adding a clear path in the mobile space, offers the corporation a clear, single solution for hardware security within their end devices which they are very anxiously looking for.

...So let me say a couple of things. One, I'm not so sure I can comment on other people's plans, etc., some of which we may have peripheral involvement and some of which we may not. Having said that, on a technological basis, we really welcome the concept of greater standardization in the mobile platform for security. You're correct in that these technologies for programmable security in hardware is very reminiscent of what Wave did back in 1999/2000 timeframe and we have a wealth of experience and capability and in some cases intellectual property in this space.

But I would say mostly, our -- the way we look at this market going forward is as they move towards the support of trusted computing type standards, what we intend to do is to provide infrastructure for the enterprise to help manage these devices. I think that's our clear task today is how do we help a corporation key the device, how do we help them manage the security of a device around the trusted computing standards.

And that way we can offer interoperability on the PC platform and on the mobile handsets going forward. And so I won't comment much more on the details of the technology. I think we need to let that unfold in the marketplace and see what people do. But our focus and where our business development efforts are and where our energies are focused, and the thing that we can deliver best is to provide the tools and infrastructure to the enterprise to take advantage of hardware security that's built into the device. It's very consistent with what we've been doing for the last number of years and it sets the stage going forward.

Hopefully with the advent of even more devices offering security that's designed in from the factory, it will eventually dawn on the enterprise that they should go out and turn on the security they already own instead of stapling on third party security products. And that's clearly today where we're still at the very early conversions of the market. Less than 1% of these trusted computing technologies are really turned on and in broad use today and that's what has to change. And that change of that market is being supported by Microsoft's investment and ARM's investments and the PC manufacturers' investments and the handsets' investments. And everybody together I believe can actually move the IT departments of the world to actually go turn on the hardware security that they have. But it's going to take a community to do it and Wave is in a very strong position and there's not a lot of competition in this space. For the same reasons it's been a hard market, it creates an advantage for us in that we have tens of millions of dollars that's been invested in the infrastructure which gives us a clear advantage and lead in the market." q1 12