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Digital ID: Good tech, lots of optimism, many doubts

Digital ID: Good tech, lots of optimism, many doubts

There is little in the way of coalescence in the global digital ID sector especially considering all the investments going into digital IDs and all the coverage of the concept over the last several years.

Insiders and observers alike still see a world of competing technologies and schemes, and all the while, individuals are acquiescing to biometric ID checks for even minor transactions and with multiple, unconnected companies.

There is the concern that the atomized environment privacy advocates and even some digital ID companies have warned about is almost here. Consumers, employees and countless others will have to negotiated with multiple unseen entities who have more control over their biometric privacy than they do.

Encouraging market forecasts and statements that “many countries have already instituted national digital IDs” are optimistic and sometimes ignore one of the basic problems the industry faces – a lack of interoperability.

India, with its massive Aadhaar digital ID program, has shown how multi-function, living identification verification can be imposed from the top down, but that is not a model that would work for every nation.

And success that it may be, Aadhaar is not even natively linked to India’s Digi Yatra ID-processing app much less to other nations’ digital identity schemes.

Boutique digital ID and security consulting firm Liminal has predicted that the reusable ID market will shoot from $53 billion this year to $328 billion in 2027.

That is despite the fact that the ID sector as a whole today looks more like the local area networking world in the mid-1990s than an industry beginning to coalesce enough that fundamental technology principles can be taken for granted.

Liminal notes in a recent report that open wallet standards that are part of the European Union’s eIDAS 2 edict “will encourage private-sector participation” in the effort. That is probably true, but as its analysts note, people have to opt in. Any holdouts create the one thing everyone hates (other than fraud) – system friction.

The company cites “big tech companies” entering the digital ID arena as if that will zip everything together despite all history to the contrary.

Apple has launched its mobile driver license app, it points out, and could have 12 U.S. states signed up by 2024. Good, but that is hardly a dominating vision. And Apple is peerless when it comes to building its own sandbox behind a giant fence and being happy with only having a few children in to play.

Reusable IDs address at least some aspects of interoperability, but it is not clear if the play-nice attitude of its developers extends to entirely different ID schemes.

The Times in London interviewed a number of executives in this sector, including Mike Tuchen, CEO of ID verifier Onfido, who reportedly said he does not expect to see interoperability “between different countries for a number of years.”

Yoti’s Robin Tombs sees watermarks of reusable digital IDs becoming standard within five years, but notes that the specter of a potential of a government monopoly is holding back private investment.

It all adds up to a good effort, but much needs to be changed in the industry or created before optimism is replaced by results.

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