ACTIVCARD PROVIDES SOFTWARE FOR IBM SECURITY SOLUTION.

ActivCard Corp (NASDAQ:ACTI) has begun participating in a major breakthrough security solution. This solution is designed to help businesses and government agencies protect their data, computer systems and facilities from unauthorized users.

IBM (NYSE:IBM) created this new solution in association with ActivCard, Bioscrypt, ImageWare and VeriSign. Using IBM's Tivoli identity management software, software from ActivCard, and solutions from the other companies, the new solution extends ID management beyond traditional information technology applications such as operating systems and networks, to include "physical" identity security characteristics contained in biometrics, smart cards and badge-reader technologies. This new solution is designed to be incorporated into the basic processes that businesses and agencies use in their day-to-day operations, while adding additional security through enhanced authentication and authorization.

Thus, organizations can simultaneously protect their "logical" assets such as data, applications and IT networks -- with their physical assets such as buildings, workplaces and grounds. Until now, companies only offered ID-management systems that protected both logical and physical assets on a limited scale. This solution is particularly important to government agencies and businesses as this new, easy-to-use solution can accommodate large volumes of users.

Identity management is considered so critical that the White House issued on August 27, 2004, a Homeland Security Presidential Directive establishing "a mandatory, Government-wide standard for secure and reliable forms of identification issued by the Federal Government to its employees and contractors."

However, integrating secure identity and authentication can be extremely complex, costly and time consuming. It is further complicated as companies add or subtract workers, devices, workplace locations, partners or vendors. In each case, passwords or other protective processes - known as "touch" points - need to be controlled and managed, adding to the complexity.

"ActivCard continues to lead the industry in the development and deployment of security based software for smart cards," said Ben Barnes, chief executive officer of ActivCard. "ActivCard is pleased to help IBM bring the first complete and scalable, physical and logical access solution to the market. We look forward to working closely with IBM and our partners in helping Enterprises and Government Agencies strengthen their security practices while providing their employees with more efficient solutions."

Secure identity technology has emerged as a crucial mechanism for absolute verification of an individual's identity. According to IDC, the worldwide market for identity management software alone will increase 46 percent annually, reaching $4 billion by 2007.

"The value of this solution is its simplicity," said Kent Blossom, director, IBM Safety and Security Services. "We're helping transform complex, manual processes into an integrated, easy-to-manage workflow. This solution helps eliminate many of the confusing technology choices and complicated business processes in use today. It provides a single platform to help customers' fulfill their logical and physical-access needs."

The new solution is on display at IBM's Institute for Electronic Government in Washington, D.C. and adds to IBM's Government Security Consulting practice portfolio. This group harnesses IBM's security consultants, IT services, hardware and software solutions and IBM Research expertise to deliver innovative security solutions worldwide.

About ActivCard

ActivCard is a provider of strong authentication and trusted digital identity solutions for secure remote access, single sign-on and enterprise access cards. ActivCard's scalable systems and strong authentication solutions are deployed by organizations, from enterprises to governments, around the world. ActivCard provides organizations with industry-specific solutions offering increased security, reduced cost, and user convenience. The modular product design allows customers to add capabilities as required, preserving their investment. Headquartered in Fremont, California, ActivCard has sales and service centers in more than seven countries.

ActivCard can be found on the World Wide Web at http://www.activcard.com/.

For more information, call 510/745-6221 or [phone].