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March 6, 2000

Legally Binding E-Documents Move Closer To Reality
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The company recently launched RueschLink, a secure extranet built using CyberTrust's Secure Extranets package. The package includes a certificate authority, Web server, directory, database, firewall, access control, and managed services. CyberTrust's system supports privilege-based user access, data confidentiality, audit trails, and digitally signed, binding transactions, says Jeremy Wyant, a senior technologist at CyberTrust.

RueschLink operates under CyberTrust's model for three-tier shared security. Security is "shared" because Ruesch clients take partial responsibility for maintaining security by agreeing to keep passwords secret and regulating the issuance and revocation of digital certificates. CyberTrust says it can build a PKI system for customers for $50,000 to $100,000.

Few things are as frustrating as collaborating on a document by E-mail only to realize that no one is sure which version is the latest or what changes have been approved. This can cost money if the document is a new contract with a business partner. Chris Russell, CFO of Persistence Software Inc., a San Mateo, Calif., provider of software tools for E-business, says it's frustrating to watch employees hunt frantically for a lost piece of paper. "We only have 200 people at Persistence and we don't need them spending time searching for lost paper," she says.

To change that, Persistence is testing a Web-based contract-management system from startup diCarta Inc. The application service provider's hosted Contract Administration suite comprises modules to handle contract setup and maintenance, renewals, revenue management, and product upgrades. DiCarta lets customers put contracts with their customers on the Internet via portals hosted by ASPs. DiCarta customers then have access to a workflow system to help manage contract negotiations, renewals, revenue posting, and delivery of software upgrades, says Scott Martin, president and CEO of diCarta, which planned to release its product in January. DiCarta also is building an intelligent database of contract clauses that its customers will be able to draw on as they negotiate and develop new contracts online.

Another challenge to delivering legally binding E-documents over the Internet is context, says Russ Gates, global director of Computer Risk Management for Arthur Andersen & Co.'s Chicago practice and worldwide director of the firm's eBusiness Risk Consulting and Assurance initiatives.

Chris Russell Photo by Richard Morgenstein Many people visit a Web site, read a contract for a software license, and then click on a button that says, "I agree." In an HTML form, that answer would be forwarded to a database on the back end--without the question. So, at a later time, how does one prove the context or what was agreed upon? The answer, Gates says, can be XML's property of tagging data. "Extensible Markup Language lets you keep the context of the content with the content," Gates says.

ILumin offers another use of XML-enabled digital signatures that users can employ to tag a document in order to code certain bits of data as private while others are allowed to pass through a firewall. When information is accessed by a browser, the public data is translated into HTML as it passes through the iLumin firewall. "That means documents can be made public while shielding personal information," says CEO Israelsen. Utah's Third District Court is using iLumin's system to let district attorneys transfer criminal filings to the court over the Internet.

ILumin users will need a Java application server and a Web server. The product is available now on a per-project basis; pricing was not revealed. This summer the company plans to license the software and offer it on a per-transaction basis.

Another secure XML system called the InternetForms Commerce System lets companies securely create, complete, sign, and process legally binding XML documents. ICS, created by PureEdge Solutions Inc., eliminates dependence on paper in E-commerce transactions by creating legally binding digital records that are stored in a single, digitally signed file.

In transactions using HTML documents, which are stratified so that presentation data and logic are in separate components, the process essentially has separated the questions and answers. "That destroys the legal admissibility of the document because the meanings of the answers stored in the database can vary dramatically depending on the question that was asked," says Eric Jordan, president and CEO of PureEdge.

Another factor that's keeping public key infrastrucure and digital signatures in the test bed is cost. Gartner Group says most companies are deploying small, pilot PKI projects that cost between $80,000 and $120,000 for software fees and a like amount for professional services. However, the research firm says, the cost of implementing a full-scale rollout of PKI will run more than $1 million. Says a Gartner Group report: "Adding to the market confusion, PKI pricing is inconsistent across vendors and is difficult for end users to understand. Vendors will need to adjust their pricing or face the threat of substitute technology."

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