Because the cards and card readers must be interoperable, the Pentagon's Defense Management Data Center asked the company to provide a "test suite" to check various cards and readers and certify that they are indeed interoperable, Roberts said.
Cubic was selected because the company has developed wireless smart-card technology for use in its mass-transit fare collection business that are "card agnostic," he said.
"We have chosen as a strategy to make readers that can work with any card," Roberts said. Such card readers have been installed for transit systems in the Washington and Baltimore area, he added.
ImageWare's software has been used to create IDs and other documents chiefly for law enforcement agencies, "so this would be a fairly new business for us," Miller said.
In the second quarter ended June 30, ImageWare posted a loss of $1.3 million, or 10 cents a share, on revenue of $2.3 million. The company reported a net loss of $8.3 million on annual revenue of $9.5 million in 2005.
Miller attributed the company's losses in part to heavy expenditures on research and development, particularly over the past three years.
Still, the tiny company, which has 90 employees and a market valuation of $26 million, has not posted a profit since it became publicly traded six years ago, according to Bloomberg financial data.
To compete with companies such as Lockheed Martin, General Dynamics and SI International, which also offer ID technology to meet the presidential directive, ImageWare will incorporate its software in equipment offered by GE Security, Hewlett-Packard and other partners, Miller said.
Now that the federal government has set standards for smart-card IDs, the market probably will expand because government contractors and other companies are likely to adopt the same technology for their own use, Miller said.
"There's money to be made all over the playing field now, simply because of the amount of penetration into the market that the government smart card will have," said Bill Richardson of HID Global, an Irvine, Calif., company that specializes in smart-card technology.
Copyright 2006 Copley News Service
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