Optimistic OutlookOptimistic Outlook

Stratton Sclavos is the 42-year-old chairman and CEO of VeriSign Inc., the $1.2 billion-a-year provider of digital commerce, security, and telecommunication services. VeriSign is perhaps best known for managing the .com and .net Internet domains. As an executive deeply involved in the growth of the Internet, Sclavos says technology finally is delivering on the promise of automating and modernizing business processes. The key, he says, is better information.

Customers are demanding better information to help them make smarter decisions on E-commerce, security, and fraud threats. "They want to reach beyond their enterprises' borders and see what's happening in real time," he says. "It's all about intelligence."

Real-time information is becoming even more important as advances in technology give business managers the opportunity to gather and analyze greater quantities of data more quickly. One of the new technologies that will bring about profound change is radio-frequency identification, or RFID, Sclavos says.

VeriSign was selected by EPCglobal Inc., the organization that oversees U.S. RFID standards, to operate its root directory of RFID product codes. The root directory for the Electronic Product Code Network will assign unique product codes to products tagged with RFID devices. VeriSign will run the EPC network on its Advanced Transaction Lookup and Signaling System. Atlas supports VeriSign's operation of the .net and .com registries and can reconcile a domain name with its IP address in milliseconds. The system runs 10 billion such lookups a day and can handle up to 100 billion transactions a day.

"We believe that RFID has such an economic impact to manufacturers and retailers that it's going to be a big, big success," Sclavos says.

Another area of interest is using VeriSign's control of the the Internet domain name registry to help businesses improve security. VeriSign's ability to monitor Internet and electronic payment trends can help companies discover potential fraudulent activity, Sclavos says. "Whether it's emerging directory services like RFID or intelligence and control services like security, it's these types of services we will be continuing to build out in 2004 and 2005," he says.

That will position VeriSign to take advantage of a recovery in the technology and telecommunications markets, which Sclavos says has already started in a modest way. He expects overall tech spending to increase and customers to show growing interest in new products. Once more customers do shake off the gloom of the recession, they'll "choose vendors that are the leaders in their field, substantial in size and financially viable," he says.

The recovery also will boost demand for new technologies and services such as wireless data and voice over IP. "All of those things that we as an industry hyped back in 2000 and then had been given up for dead, we're now starting to see them come together," he says.

Sclavos rejects the argument made by some that IT has become a commodity and doesn't offer a competitive advantage. "I don't agree with the premise," he says. "The productivity numbers we're seeing are being driven in no small part by IT investments we've made in the past five to seven years. You can see how IT has become woven into the infrastructure, so it's disappearing into normal business processes and normal operating dynamics. IT is such a utility now that it's being taken for granted as something we need to plug into to do our business."

That presents a great opportunity for high school and college students who are thinking about a career in business technology. "We desperately need more U.S.-educated technology experts, whether it's in engineering, marketing, or general business," he says. "Tech is going to be the huge driver that changes the economic priorities throughout the world in the next 20 to 30 years."

As he watches his school-age daughter grow up, Sclavos is convinced that the younger generation will continue to develop and deliver technology innovations for many years. "It's gotten to the point now that using technology is just what they do," he says. "It's become so second nature to them you can only imagine when they take over the things we will see them develop."

That helps to explain why Sclavos is an optimist, despite the difficult times of the past few years. "Although we had a bubble burst and people were melancholy about that, when all of the books are written, the past decade will look like a decade with tremendous productivity gains and innovations that will bring about a new standard of living around the globe."

But tech vendors have to adapt, he says. Throughout the 1990s, VeriSign had a motto that innovation equals invention. But that slogan is changing. Now the company believes that innovation equals integration. "It's taking the next step and bringing all of these technologies together and removing the complexity from the end user," he says. The result is "greater productivity because all of this stuff works together."