SUNNYVALE, Calif. -- The use of layered security and software-based authentication to protect online users will grow rapidly in 2008, according to new research by Aberdeen Group. The number of enterprises using digital watermarks is expected to double in 2008 from its current level to 22%. Rapid growth is also expected for risk-based authentication, from 20% to 32%, and transaction monitoring, from 49% to 68%, based on plans reported by banks, retailers, telecom and other organizations participating in the research.

The new Aberdeen report, “Securing the Online User Experience – Building User Confidence and Stopping Fraud” details the strategies, capabilities and technologies used by the organizations doing the best job at preventing online fraud and building user confidence. A clear finding is that the best-in-class enterprises have already moved beyond passwords, and many more firms plan to take action in 2008. The results are consistent with what Arcot sees happening in today’s market.

“Passwords are weak security; the problem is they are convenient and people know how to use them,” said Carol Alexander, vice president, marketing for Arcot, a leader in software-based authentication. “This research confirms what we’re hearing from banking and other industries: With billions of passwords in daily use, the only practical solution is to make passwords strong without changing the user experience. This study shows we are on the right track.”

Aberdeen Group

Arcot Systems