[ISN] Financial firms turn on secure IM

From: InfoSec News (isnat_private)
Date: Tue Apr 09 2002 - 00:50:42 PDT

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    By Troy Wolverton 
    Staff Writer, CNET News.com
    April 8, 2002, 4:50 PM PT
    Several leading financial services companies signed up for an instant
    messaging service Monday designed to provide security and allow
    control over the information sent to clients and employees.
    Salomon Smith Barney, J.P. Morgan Chase, Merrill Lynch, Credit Suisse
    First Boston, Goldman Sachs, Lehman Brothers, Morgan Stanley and UBS
    Warburg have begun using the Communicator Hub IM service, creator
    Communicator announced Monday. The companies have each signed
    multiyear, multimillion-dollar contracts to license the service for
    their employees and institutional clients, said Leo Schlinkert, chief
    executive of Communicator.
    "Companies are being besieged by their employees who want instant
    messaging to communicate with their fellow employees and, more
    importantly, with their customers and partners," Schlinkert said in a
    statement. White Plains, N.Y.-based Communicator has a small
    investment in SecuritiesHub, a consortium owned by the eight financial
    services companies that signed up for the service Monday.
    Overwhelmingly popular with consumers, instant messaging has also
    gained increased acceptance with business users. Companies such as
    eBay have tested IM services to communicate with customers. Microsoft
    and Sun Microsystems announced plans last year to develop IM products
    targeted at business customers.
    Although many employees run AOL Instant Messenger (AIM) or Yahoo
    Messenger on their office computers, companies have been concerned
    with the programs' technical, security and policy issues, with some
    financial institutions banning the use of instant messaging for sales
    or trades. According to a survey released last month by Osterman
    Research, 23 percent of companies block IM communications on their
    servers. Among companies that have settled on an IM standard, 65
    percent chose IBM's Lotus Sametime technology.
    Founded in 1999, Communicator has thus far focused on the financial
    services industry, but it plans to offer its service to the energy,
    chemicals and pharmaceuticals industries.
    To use the service, clients install Hub IM software on their PCs. The
    software comes in two forms: a Java-based stand-alone application and
    a non-Java version that runs within an Internet-connected Web browser.  
    Traffic is routed through Communicator's computers. The service
    secures messages by sending them through SSL (Secure Sockets Layer), a
    transaction security standard that enables commercial transactions to
    take place online.
    The Hub IM also allows companies to tailor the material transmitted
    and have greater control over the information. For example, a mutual
    fund company could use the service to contact both J.P. Morgan Chase
    and Merrill Lynch, but neither of the financial services companies
    would be able to tell by the information that they had the same
    client. It also allows a company to have a common address book rather
    than requiring employees to create their own unique "buddy lists," and
    it gives the company more control over archives of IM conversations.
    Salomon Smith Barney has been testing a beta version of Communicator's
    service since last summer and began using a full release of the
    service early last month, said John Casaudoumecq, managing director of
    Salomon's global fixed income e-commerce division. Some 3,000
    employees are using the service, and Salomon plans to expand the use
    of the service from its fixed income division to other areas in the
    company, Casaudoumecq said.
    Salomon has also been encouraging clients to adopt the service, he
    said. Salomon likes the service because it meets the company's
    security standards and is flexible enough to allow the company to use
    it as it sees fit, he said.
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