information about themselves as they build trust with the Web sites they visit. So someone might have one pseudonym disclosing financial information at online bank Wingspan and another pseudonym disclosing only their entertainment and news preferences at Yahoo. "With pseudonymity, you know as much about me as I'm willing to tell you."
Zero-Knowledge routes its traffic over encrypted servers, so Web sites they visit don't even see customers' IP addresses. Customers pay $10 per pseudonym per year and nothing for the software.
Hill won't say how many subscribers his company has, but he did disclose that there were 85,000 for the beta test, which ended when the commercial product was launched December 1. Zero-Knowledge partners with about 180 ISPs, including PSINet. The system is built so that it would be impossible for Zero-Knowledge or its partners to reconstruct a subscriber's identity. This contrasts with emerging infomediaries, which are responsible for disclosing subscriber information selectively but also can disclose the identity if necessary, says Hill.
Meanwhile, Zero-Knowledge is taking off. His firm's 80 employees in December have grown to about 200 now, and he expects to have 600 by the end of the year. The company has raised $38 million, led by Platinum Venture Partners and Strategic Acquisitions Ventures, and is planning another round in the next two months. The company, which isn't profitable yet, has an IPO in its future.
In December, Zero-Knowledge acquired patents that enable anonymous electronic cash transactions and other anonymous credentials that would allow people to prove to an adult Web site that they're over 18 or a U.S. citizen, or show an auction site that they have credit without revealing other information, for example. Commercial products using that technology are expected early next year. "We're giving people the ability to stop the collection of [their] data," says Hill. "From there, we'll give them the ability to manage their IDs."
In addition, Zero-Knowledge is talking to backbone providers, networking equipment and computer manufacturers, portals and others about bundling privacy technology into their products and services, he says, declining to name names. "Our goal is to have privacy kits ubiquitous the same way browsers are now."
And what of the burgeoning field of direct marketing? It will evolve into permission-based marketing, which gets response rates of 18 to 28 percent, as opposed to the usual online ad, which has a response rate of 1 percent or less. Hill says: "Profile-based marketing is dead."
Basically, Hill is hoping to bring the Web back to the days when the saying "On the Internet, nobody knows you're a dog" was true.
