posted 12-23-2001 01:11 PM            

Wednesday December 19, 8:06 am Eastern Time
Press Release
SOURCE: Applied Digital Solutions
Applied Digital Solutions Introduces Verichip, a Miniaturized, Implantable Identification Device With a Variety of Medical, Security and Emergency Applications
PALM BEACH, Fla.--(BUSINESS WIRE)--Dec. 19, 2001--Applied Digital Solutions, Inc. (Nasdaq: ADSX - news), an advanced digital technology development company, announced today that it has developed a miniaturized, implantable identification chip -- called VeriChip(TM) -- that can be used in a variety of medical, security and emergency applications.

How VeriChip Works

VeriChip is an implantable, 12mm by 2.1mm radio frequency device about the size of the point of a typical ballpoint pen. Each VeriChip will contain a unique identification number and other critical data. Utilizing an external scanner, radio frequency energy passes through the skin energizing the dormant VeriChip, which then emits a radio frequency signal transmitting the identification number and other data contained in the VeriChip. The scanner will display the identification number, but the VeriChip data can also be transmitted, via telephone or the Internet, to an FDA compliant, secure data-storage site. It will then be accessible by authorized personnel. Inserting the VeriChip device is a simple procedure performed in an outpatient, office setting. It requires only local anesthesia, a tiny incision and perhaps a small adhesive bandage. Sutures are not necessary.

Medical Device Identification

Hundreds of thousands of medical devices are surgically implanted into patients every year. Examples of these life-saving and life-enhancing devices include pacemakers, artificial joints, orthopedic hardware, heart valves, and medication pumps. After insertion, these devices often require adjustment, repair, replacement, or even recall. VeriChip, inserted subdermally just above the implanted medical device, provides patients, medical providers, and manufacturers with a rapid, secure and non-invasive method for obtaining medically critical information about the device. VeriChip is a ready source of data about the patient's name and condition as well as the medical device's original components, required settings and other essential parameters. Future applications may include full medical record archival/retrieval for emergency medical care.

Emergency or Security-related Identification

Personal identity verification technology has gained considerable interest recently. A great deal of focus has been trained on so-called ``biometric'' technologies - which identify individuals by their unique biological or physical characteristics, such as fingerprints, voiceprints, retina characteristics, and face recognition points. VeriChip, by contrast, relies on imbedded, tamper-proof, microchip technology, which allows for non-invasive access to identification, medical and other critical data. Use of advanced VeriChip technology means that the threat of theft, loss, duplication or counterfeiting of data is substantially diminished or eliminated. Specific application areas include: enhancement of present forms of identification, search and rescue, and various law enforcement and defense uses.

Commenting on the announcement, Richard J. Sullivan, Chairman and CEO of Applied Digital Solutions stated: ``With VeriChip, Applied Digital has taken another significant step in developing leading-edge personal security technologies for a rapidly evolving marketplace. VeriChip joins Digital Angel(TM) and Thermo Life(TM) in our repertoire of breakthrough technologies. All of these are designed specifically to save lives, enhance personal security and improve quality of life. We're looking forward to working with the medical community and other potential partners to bring VeriChip to market as quickly as possible.''

About Digital Angel(TM)

Digital Angel represents the first-ever combination of advanced biosensor technology and Web-enabled wireless telecommunications linked to Global Positioning Systems (GPS). By utilizing advanced biosensor capabilities, Digital Angel will be able to monitor key body functions - such as temperature and pulse - and transmit that data, along with accurate location information, to a ground station or monitoring facility. Digital Angel Corporation has announced a proposed merger with Medical Advisory Systems. For more information on Digital Angel, visit www.digitalangel.net.

About Thermo Life(TM)

In November of 2001, Applied Digital Solutions created a wholly owned subsidiary called Advanced Power Solutions, Inc. (APSI). This new unit will further develop, market and license Thermo Life(TM), a proprietary, thermoelectric generator powered by body heat. Thermo Life is intended to provide a miniaturized power source for a wide range of consumer electronic devices, including attachable or implantable medical devices, wristwatches and other consumer devices. The Company estimates that the potential marketplace for Thermo Life exceeds $30 billion.

About Applied Digital Solutions, Inc.

Applied Digital Solutions is an advanced digital technology development company that focuses on a range of early warning alert, miniaturized power sources and security monitoring systems combined with the comprehensive data management services required to support them. Through its Advanced Wireless unit, the Company specializes in security-related data collection, value-added data intelligence and complex data delivery systems for a wide variety of end users including commercial operations, government agencies and consumers. For more information, visit the company's website at http://www.adsx.com.

Statements about the Company's future expectations, including future revenues and earnings, and all other statements in this press release other than historical facts, are `forward-looking statements' within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and as that term is defined in the Private Litigation Reform Act of 1995. The Company intends that such forward-looking statements involve risks and uncertainties and are subject to change at any time, and the Company's actual results could differ materially from expected results. The Company undertakes no obligation to update forward-looking statements to reflect subsequently occurring events or circumstances.

posted 04-29-2002 10:04 PM            

Shoppers headed for the West Seattle Thriftway Wednesday can leave their credit cards, debit cards and checks at home. They just need to make sure to bring their index fingers.

The supermarket will be the first in Washington and one of the first in the nation to use a biometrics system -- finger scanning -- to tie consumers to their credit cards, electronic benefit cards and checking accounts, says the maker of the system, Indivos of Oakland, Calif.

"The main thing is, it's fast, it's easy, and it's secure," says Paul Kapioski, West Seattle Thriftway owner.

Consumers enroll in the system by putting their index finger on an image reader, which runs digital information for 13 points on the finger through a formula, and stores the encrypted information on Indivos servers. Consumers register whichever cards or accounts they want associated with their finger scan.

"It takes about one minute to enroll," Kapioski said. Enrollment begins Wednesday and is strictly voluntary, he emphasized. Wary customers still will be able to pay the old-fashioned way if they want.

Once enrolled, consumers won't need to hassle with their wallets or purses. Instead, they'll just pass their fingers over the image reader.

For those whose payment is tied to their checking account or debit card, that's it. Customers who want their credit card billed still will have to sign a receipt.

The main advantage of the new system, Kapioski said, is the security. People no longer have to worry that their cards will be lost or stolen and then used to run up hefty charges. Stores and credit card issuers will likewise avoid the losses associated with identity theft.

"If we can come up with a payment method where there's no opportunity for fraud, then the fees come down," Kapioski said.
He first saw the Indivos system at a technology show in San Diego in January and expressed interest to Doug Mills of Associated Grocers. Mills agreed that Kapioski's store, at Southwest Morgan Street and California Avenue Southwest, could be the first Thriftway to try it.

Employees underwent 15 or 20 minutes of training in the system this week.
"They're excited about it," Kapioski said.
Kapioski said he's put about four months into studying the system to remove any doubts, and he claims "it's foolproof."

If other stores adopt the Indivos system, consumers would not need to re-enroll, because their finger scans and accounts would already be in Indivos' servers, said Jim Nickerson, a company spokesman.
McDonald's has done a limited pilot of the system in California.

"They love it because it takes the cash out of the hands of 18-year-old clerks," Nickerson said.

Nickerson expects a flurry of announcements in coming weeks of major chains adopting the system. Indivos' main competitor, Biometric Access Corp. of Round Rock, Texas, rolled out a pilot test of its biometric system in some Kroger grocery stores in Texas about two weeks ago.

Indivos has sued Biometric Access for patent infringement.

posted 05-15-2002 08:22 PM            

May 15, 2002, 4:13PM

It's kinda touch-and-go
New system lets Kroger shoppers pay with fingerprint

By DAVID KAPLAN
Copyright 2002 Houston Chronicle

COLLEGE STATION -- At Kroger stores here customers are getting their groceries without cash, check or credit card.

No, they're not using the five-finger discount. One finger will do.

They rely on a new little machine called SecureTouch-n-Pay which enables a finger to bring home the bacon and give cash back.

In the Bryan-College Station area, Kroger is trying out the new retail point-of-sale system in its three stores.

Shoppers who enroll free of charge to use the finger image machine -- officially known as a biometric electronic financial transaction processing system -- simply walk up to a cashier, say, "I'm going to pay with my fingerprint" and voilá.

Many customers are initially leery. They associate fingerprinting with getting hauled to jail -- not picking up milk.

But once they get over their fears and try it, they like it, said Sam Powel, co-manager of one of the three Kroger stores in the Bryan-College Station area.

At first, Powel said, "it was a Big Brother scenario. But that seems to have died down."

Women in particular appreciate SecureTouch, he said, because they don't have to bring in their purses.

The pilot program began three months ago. The three Bryan-College Station locations are the only Kroger stores in the nation experimenting with SecureTouch.

About 10 to 15 people per store sign up each week, a very small percentage of Kroger's customers.

To enroll in the fingerprint identity verification system, customers show a Kroger representative their driver's license and a credit card, and have their fingerprints recorded. Typically their phone number becomes their PIN.

SecureTouch software and hardware were developed by Austin-based Biometric Access Corp. Other companies have created similar fingerprint identity verification technology.

Customer feedback has been "very positive," said Gary Huddleston, Kroger's consumer affairs manager, who noted that the company is still evaluating the program. If it is deemed successful, he said, it may one day be implemented in Houston and other cities.

Kroger customer Mary Smith, an employee relations representative at Texas A&M University, had mixed feelings about SecureTouch when she first heard about it.

"I was maybe a little afraid of it, but I like new stuff," Smith said. "I just thought I'd try it.

"I think it's fine. It's quick. I don't have to write a check."

Smith has exceptionally dry skin and has to rub her finger behind her ear or against the side of her nose before pressing it on the small SecureTouch window.

The finger image-based verification system has two big benefits for Kroger, Huddleston said, one being "speed at the front end" which "is a savings to us."

The other benefit, for both Kroger and customers, is fewer forged checks.

If a thief were to come in with a stolen check and stolen ID belonging to someone enrolled in SecureTouch, the cashier -- after learning automatically from the computer that the check owner was enrolled in SecureTouch -- would become suspicious that the thief had not opted to use the quicker fingerprinting method of check cashing.

Kroger became interested in the finger image machine three years ago, when the state of Texas began its own pilot program with the intention of eliminating food stamp fraud. It came out with a finger image version of the "Lone Star Card" used by food stamp recipients. The state approached Kroger and asked if it would participate in the pilot program.

After a budget cut, the state abandoned the program, but Kroger -- the largest supermarket chain in the U.S. -- continued to explore the system.

Holly Rios, marketing manager at Biometric Access, said that no other grocery chain is using her company's SecureTouch for point-of-sale transactions. One of her company's competitors, Indivos, began trying out a similar system in one grocery store in Seattle about two weeks ago, Rios said.

A finger image machine might one day be in a store near you.

"It's all about convenience for the shopper," said Lorrie Griffith, associate editor of the Shelby Report, a trade journal specializing in the supermarket industry.

The self checkout machine is already fairly common, said Griffith, and other technologies are in the works -- including Electronic Product Code, which will enable a cart full of groceries to be scanned and totaled quickly without having to take them out of the cart.

Some customers will resist the fingerprint system because of privacy issues, said Griffith, who noted that there are grocery shoppers "who don't even want loyalty cards, because they gather information about you."

But they are a relatively small percentage of consumers, she said.

"Most people are very interested in convenience," said Griffith.

A few women in College Station belong to a gym near the Kroger, and after their workout they come to the store without a wallet or purse to buy Gatorade, Huddleston said.

Rios maintained that SecureTouch is very secure and has safeguards against identity theft.

The finger image payment process does not always work the first time. Sometimes a customer has to press his finger on the window more than once to activate the machine, because the finger is not positioned at the correct angle.

Tas Ates, a Blinn Junior College student and a pizza delivery driver, said that SecureTouch made him nervous at first.

He had a fantasy of his fingerprint being "captured and planted at a crime scene," but he's gotten over that, he said with a smile.

Kroger customer Mary Smith said she has a daughter in Katy who wants nothing to do with the finger image method of payment. She told her mother that it is "a way to get into your identity."

It's funny, Smith said, "you'd think it would be the old fart who'd be afraid." http://www.chron.com/cs/CDA/story.hts/front/1411509

posted 06-24-2002 04:29 PM            

washingtonpost.com
Airlines Plan Quick System For Identifying Passengers

By Robert O'Harrow Jr.
Washington Post Staff Writer
Saturday, June 22, 2002; Page E01

Several airlines have begun working on plans for a passenger identification system that would rely on background checks, fingerprints, iris scans and high-tech IDs to verify individuals' identities and speed security screening at airports.

The "trusted traveler" program would give pre-screened passengers easier access through security checkpoints, much as frequent-flier cards permit certain regular travelers to board airplanes before other passengers.

Industry officials floated the idea last fall as a way to minimize chronic security delays that carriers blame for declines in passengers and revenue. But officials in the new Transportation Security Administration have repeatedly declined to endorse it, saying such a system might be vulnerable to abuse by terrorists.

TSA chief John W. Magaw said terrorists could infiltrate a smart-card system over a period of years. Terrorists are patient, Magaw said in a speech Tuesday at an aviation security conference in Washington. "That's why I'm concerned," he said.

But the approach appears to have growing support from Tom Ridge, the director of homeland security, who urged Northwest Airlines, Continental, Delta and other carriers in a private meeting two weeks ago to develop a detailed plan on how they would implement such a program, according to people familiar with the meeting.

"We'll work together with the airline industry," said Gordon Johndroe, spokesman for the White House Office of Homeland Security. "We're going to take a look at this."

The industry action comes at a time of frustration for airline officials, who have become increasingly vocal about their contention that the unwillingness of transportation security officials to even test trusted-traveler programs has exacerbated a falloff in travel since the Sept. 11 terror attacks, especially on shorter flights.

Industry officials complain that the security agency has been distracted by congressionally mandated deadlines for baggage screening.

Theplanning moves follow a recent proposal by President Bush to create a Department of Homeland Security that would take on responsibility for aviation security. Aviation industry officials believe a new department would be more accommodating to the industry in striking a balance between security and passenger convenience.

"There is a frustration among airlines that we haven't at least begun testing yet," said Dirk McMahon, a senior vice president for customer service at Northwest. "The TSA has been willing to listen. But they haven't come out in support. . . . The net result of that is our business continues to unnecessarily suffer."

It remains unclear when the airlines could begin live tests of their proposals. Working through the industry's Air Transport Association, the carriers have formed a group to oversee the drafting of a common plan. They hope to get government approval to begin test programs in the coming months.

"Clearly the technology is available," said association spokesman Michael Wascom, adding that the initiative cannot move forward without government permission. "We think this entire concept is not only good for security, it's good for customer convenience and efficiency."

Northwest has drawn up plans on its own to begin operating a test system limited to airline employees who have had background checks. The traveling employees would be issued "smart" identity cards incorporating chips containing a biometric identifier, such as fingerprints or scans of the iris.

If the system works and government officials approve it, the airline would begin issuing such cards to passengers willing to undergo a background check and share their biometric identifiers, McMahon said. Details, such as who would conduct the background checks, remain unclear.

Checked passengers would still have to go through some level of screening at an airport, but it would be less demanding and speedier than the processing of unchecked travelers, he said.

"This isn't 'no security' at the airport. It's a lesser amount of security," he said. "Every single carrier has said, 'Let's check this out.'. . . We're chomping at the bit to go forward."

But hurdles remain. Civil libertarians promised to try to stop any trusted-traveler system, saying it would lead to discrimination, the tracking of individuals and less security.

Barry Steinhardt, director of the American Civil Liberties Union's Program on Technology and Liberty, said millions of people would feel compelled to share their personal information before there are rules to control and protect those details. At the same time, he said, such a system would not stop the sort of terrorists who attacked on Sept. 11, most of whom had driver's licenses and other identification.

"It's a feel-good measure that won't make us safer but will deprive millions of Americans of their privacy," he said.

The industry also faces bureaucratic troubles, even among some allies in the government. One Bush administration official involved in security said the growing volume of complaints from the industry has annoyed and unsettled senior officials.

In a speech Wednesday, for example, Continental Airlines Chairman Gordon Bethune urged the administration and Congress to "reconsider arbitrary deadlines that threaten to worsen delays at airports and to gridlock U.S. air travel without making the skies safer."

Bethune used the speech to advocate a "known-traveler" program, saying airline passengers are willing to go through background checks and use smart cards to ease travel.

While some government officials are sympathetic, they do not welcome the industry pressure and worry that airline officials overstate the potential benefits of trusted-traveler programs, said a Bush official, who spoke on condition of anonymity. No matter what is decided, the official said, passengers will have to be thoroughly screened.

"They risk alienating allies in the transportation department with their continued rants," the official said.

Wascom, the industry association spokesman, said airlines do not mean to criticize the TSA. But they feel compelled to make their case that some new mandates have dramatically increased "the hassle factor," turning passengers away from flying, he said. A trusted-traveler program could help alleviate the hassles, he said.

"In many respects -- and this is not being critical of them -- the TSA is not being realistic," he said. "Every individual passenger is not of equal security risk as the next passenger."

Staff writers Keith L. Alexander and Greg Schneider contributed to this report.

http://www.washingtonpost.com/wp-dyn/articles/A25989-2002Jun21.html

posted 06-28-2002 06:35 PM            

I was already theorizing that microwaves were being deployed to keep the crowd mellow, which it was. And the gatherings broke up quicker than usual too.

The amount of police in the streets was conspicuously light, given that 500 million dollars were spent on security.

At one point there was a crowd of determined activists in a standoff with police in front of the McDonalds. A radio report mentioned that there was a changing of the guard during this standoff, and then it just broke up.

The photo from the front page struck me as odd - showing several cops who look like clones of each other.

Hmmm.

posted 07-22-2002 11:41 PM            

Little Brother's fingerprints all over the library

By David Rowan

IT PROMISED to be the high-tech saviour of the embattled primary-school librarian, an ingenious device that guaranteed no more lost library cards and fewer missing books.

All a child had to do to borrow Topsy & Tim for the week was flick a thumb through an unobtrusive fingerprint scanner, so sensitive it could even recognise a pattern from under layers of sticky chocolate.

There was only one snag: in many cases, parents were not told that schools were storing their children’s fingerprints.

Parental outrage followed and, by last night, the school thumb-scanner being used by 1,000 British primary schools was being internationally condemned as a blatant breach of children’s human rights.

The trouble began when the mother of an 11-year-old attending the Sacred Heart Roman Catholic School in Ruislip, West London, discovered that her son had been fingerprinted without her consent.

Furious, the woman, who refused to be named, contacted civil liberties groups such as Privacy International and a child’s advocacy group, Action on Rights for Children in Education (Arch).

Privacy International called for the banning of the library-management software, sold by a Stockport company called Micro Librarian Systems. “This is unethical and disproportionate,” Simon Davies, Privacy International’s director, said.

The assistant information commissioner Phil Boyd said that there had been no breaches of the Data Protection Act, as the thumbprints were reduced to a numerical code.
http://www.timesonline.co.uk/article/0,,2-363068,00.html