At DEMO, Startups Ready to Take on the Big IT Players

SANTA CLARA, CALIF. — Intel recently paid $7.7 billion to buy McAfee and this week HP paid $1.5 billion for another security firm, Arcsight, but will startup Federated Networks out of Toronto be the first to provide “virtually unhackable” application security?

That’s the bold claim of startup Federated Networks. CEO David Lowenstein unveiled the company’s software at the DEMO conference, a showcase for new technology and startups.

“The reality is a lot of security doesn’t work and we have an opportunity to revolutionize what can be done,” Lowenstein later told InternetNews.com. He said the company plans to release a consumer version of its desktop client, with an enterprise server version next spring.

In his demo, Lowenstein showed how a bank could be compromised by phishing and keylogger attacks to steal a user’s identity and gain access to their account and personal information.”We applaud the banks for trying,” he said. “The companies they use have done a pretty good job, but pretty good isn’t good enough.”

Lowenstein claimed his company’s cloud-based FN Connect Securely architecture offers more protection because it strengthens the human-to-computer interface by way of a free, ad-supported FN client download.

Even if your password and login information is stolen, Lowenstein said a hacker can’t access your account from a remote computer that doesn’t have the user’s FN client installed.

Currently, Federated is supporting Windows and leading Web applications like Gmail, Hotmail and Facebook. The FN client acts as a kind of “meta-certification” that Lowenstein said replaces SSL, the widely used security layer that has had its share of security issues.

“Everyone has known SSL’s been weak for 15 years,” he said.

Another unique approach Federated Networks is taking is to automatically diversify its application code.

In today’s software, “so often one piece of code looks like another, and that makes it easier to crack,” he said. Each FN client actually gets a different version from a pool the company maintains — similar, from a coding perspective, to how car companies provide different locks and keys to the same model car.

Microsoft Outlook on Steroids?

Another startup ready to take on the established players is emClient.

“emClient is like Outlook on steroids,” boasted CEO Jerry Javornicky.

The communications client can be synchronized to work with popular email services like Microsoft (NASDAQ: MSFT) Outlook and Gmail. In his demo, Javornicky moved an Outlook account to emClientand performed a search with almost instant results — a big improvement over the default Outlook search.

The company offers a free consumer version and an enterprise Communications Suite that integrates with a company’s email server as well as social networks.