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Technology Stocks : Emulex, What Prospects? -- Ignore unavailable to you. Want to Upgrade?

To: stomper who wrote (544)	8/26/2000 12:48:03 AM
From: caly	Respond to of 788

Internet Wire had security...it was just bad security. And there's most definitely a price to be paid for that. Too bad innocent people are paying for it this time. Like the guy from VRSN said, "The technology is definitely there..." Friday August 25, 6:59 pm Eastern Time Emulex hoax spotlights a matter of trust By Ilaina Jonas NEW YORK, Aug 25 (Reuters) - When several news agencies ran with a bogus press release that sent the stock of data networking equipment maker Emulex Corp. (NasdaqNM:EMLX - news) plummeting more than 50 percent, it sent chills through the investment and journalism communities as well as the public at large. The con-job once again raises the question of trust and how to quickly authenticate the origin of an official statement and verify news in an age where seconds mean millions. On Friday morning, a press release, which appeared on Web-based news dissemination service Internet Wire, said Emulex's chief executive had resigned and Emulex had been forced to restate 1998 and 1999 earnings, as well as revise the fourth quarter to a loss from a gain. It also said Emulex was under investigation by the Securities and Exchange Commission (SEC). Internet Wire confirmed that the release appeared on the service, but declined further comment pending a company statement. The news was picked up by Bloomberg and Dow Jones news wires, which use Internet Wire as a source of news. The stock fell to 43 from a previous day's close of 113-1/16 but mostly recovered after the hoax was discovered. Still, shares of the Costa Mesa, Calif.-based company closed at 105-3/4, down 7-5/16 and were the second-greatest net losers on the Nasdaq behind SDL Inc. (NasdaqNM:SDLI - news). The issue is at the crux economy where information is king and the quality of it sets the extent of the reign. Electronic commerce depends upon verifying who is buying and who is selling and for what. Trading depends upon prices and what a buyer and seller will accept. Journalist, who issue information to the investment community and the public, depend upon the company issued press releases to inform the initial kernel's of information of a news event. Daniel Savio, spokesman for Business Wire, a 40-year-old service that disseminates news, said its paying member companies, about 40,000 of them, are given a password that encrypts and authenticates the sender of the electronic mail containing a press release. In the case of faxes, Business Wire staff members will call to verify the sender, he said. ``Internet wire, is just about one year old,'' Savio said. ``Call it growing pains or getting to learn the flame is hot by getting burnt. We know where the pitfalls are...We've already gone through our learning curve.'' Technologies such as authentication and encryption have sprung up in recent years. Authentication encompasses the area of digital certificates and digital signatures, which ensure a reader of the identity of a an e-mail or message. ``The technology is definitely there,'' said Bob Pratt, director of product marketing for VeriSign Inc. (NasdaqNM:VRSN - news), which makes the ``keys'' that work to unlock the box of a message containing an author's identity. ``The issue is getting people to use it. There's still a lot of people who believe things because they show up on Web sites.'' Encryption shields digital information from tampering and also prevents a message being viewed or viewed before a set time. "Encryption doesn't do anything to attest who the sender or recipient, said Ken Beer, product line manager for Tumbleweed Communications Corp.(NasdaqNM:TMWD - news), which makes the software that supports security systems. ``It really protects the information as it goes across the Internet,'' said Steve Schick, spokesman for Internet security firm Check Point Software Technologies Ltd. (NasdaqNM:CHKP - news). Even if the sender is authenticated, that doesn't mean the information is accurate. In July, Business Wire's competitor, PRNewswire, distributed a press release from unknown Pegasus Capital of a proposal to take over AutoNation Inc. (NYSE:AN - news), the largest U.S. new car retailer. PRNewswire later withdrew the release after AutoNation said that the firm did not have the means to back up the proposal and was not legitimate.