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Internet Commerce Grows 88 Percent by Dollar Volume and 39 Percent by Transaction Volume: Fraud Remains a Concern

VeriSign Releases Latest Internet Security Intelligence Briefing On Trends in Internet Usage, Commerce, Fraud, and Security Threats

MOUNTAIN VIEW, CA. February 28, 2005 - VeriSign, Inc. (Nasdaq: VRSN), the leading provider of intelligent infrastructure services for the Internet and telecommunications networks, today released the fifth edition of the VeriSign Internet Security Intelligence Briefing (ISIB).
The new edition highlights Internet commerce and fraud trends during the 2004 holiday season, security threats and vulnerability metrics with a spotlight on the shifting locations of capture sites used in phishing attacks, as well as details on the rapid growth of Internet usage and security prevention technologies.

Laptop Battery Salient highlights from the new briefing include:

Thinkpad E-Commerce Growth and Trends

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Microsoft * Internet commerce grew dramatically during the holiday season in 2004 with e-commerce dollar volume rising 88 percent as compared to the same period in 2003, and transaction volume growing by 39 percent year-over-year.
* In total, VeriSign processed approximately $12 billion in online sales between November 1 and December 31, compared to $6.4 billion for the comparable period in 2003.
* Six percent of holiday e-commerce transactions were deemed too risky to complete.
* Game stores saw the largest jump in transaction volume at 96 percent growth, followed by gift shops at 89 percent, charities at 79 percent, and digital music at 59 percent. Consumer electronic saw a decrease of 27 percent in transaction volume.
* Average purchase price per transaction decreased approximately 3 percent to $146.
* The Monday after Thanksgiving proved to be peak shopping day for Internet merchants, replacing Black Friday as the highest volume e-commerce day of the year. For brick and mortar merchants, Black Friday still remains the biggest shopping day of the year.

Newegg.com, which boasts $1 billion in annual sales of CE, IT and communications products, year, with volume spiking 58 percent on Sunday.

Laptop Computers Additionally, the briefing concludes that there are many factors contributing to the continued strong growth in e-commerce and the dramatic increases during the holiday season. These include increased customer confidence in shopping online, growing broadband/high speed Internet access penetration across the United States, availability of more inexpensive goods on the Internet, and an increasing number of rural consumers shopping online for goods they cannot buy locally.

As Internet use in Australia continues to grow rapidly for both commerce and communications, we will continue to invest in our infrastructure and services in the region to support this strong growth, said Gregg Rowley, vice president, Asia Pacific for VeriSign. The close proximity of an Internet server cluster in Sydney for .com and .net will improve the Internet experience for the growing numbers of Australian Internet users and contribute to economic growth in Australia. Were pleased to have a dedicated presence in Australia and to be able to offer advanced Internet infrastructure to serve Australian business, government, Web sites and individuals.

Laptop Computer Internet Vulnerabilities, Security Events, and Fraud

Desktop Computer * According to the briefing, Romania, Vietnam, and the United States were the top source countries for total volume of e-commerce fraud over the 2004 holiday period; Belarus Slovenia, and Vietnam were the top countries for internal percentage of fraudulent transactions .
* During the period October 2004 to January 2005, 58 percent of phishing capture sites were located outside of the United States, up from 37 percent reported for the first half of 2004. This increase is due to better efforts at shutting down capture sites in the U.S., and the comparative difficulty of shutting down capture sites abroad.
* During the period October 2004 to January 2005, the United States remained the top source country for security events generated with an overwhelming 79 percent, followed by Canada (5.7 percent), Taiwan (2.6 percent), Korea (2.5 percent) and the U.K. (2.4 percent).
* During the period October 2004 to January 2005, there continued a dramatic increase in the number of verifications of secure sites, reaching well above 9 million verifications per day in Q4 2004. The continued growth indicates strong demand among Web site operators for the use of the VeriSign Secured Seal, and the increasing propensity of online shoppers to conduct transactions only with secured Web sites.
* The number of active VeriSign SSL certificates worldwide increased, with more than 15 percent growth in 2004 over 2003.

Notebooks Both humans and worms continue to scan for systems which are un-patched against common exploits, contributing a large percentage of all security events. The briefing details individual security threats, and notes that the majority of the security events are still being generated by worm propagation attempts, such as MS-SQL version overflow and MS-PCT Client Hello overflow. During Q4 2004, VeriSign counted more than 680,000 MS-SQL version overflow attempts and over 375,000 MS-PCT Client Hello overflow attempts.

Lenovo Internet Traffic and Usage

Hard Drive * Domain Name System (DNS) queries in Q4 2004 fluctuated between 380 and 400 billion queries per month, an astonishing 80 billion queries higher than December 2003.
* The number of email-based queries continues to track to all DNS queries evenly, at approximately 13 percent, which is in line with the 14 percent reported in Q4 2003, but is much lower than the 19-24 percent range reported in Q3 2004.
* In 2004, the .com top-level domain grew over 25 percent and the .net top-level domain grew over 20 percent, showing continued demand and usage of these domains.

Travelstar Once again, the VeriSign ISIB has revealed striking Internet trends namely that usage and e-commerce continue to grow dramatically in spite of security threats, reflecting the confidence merchants and consumers have when appropriate security protections are taken, said Judy Lin, executive vice president and general manager, VeriSign Security Services. The report shows that with the right intelligence and control afforded by technologies such as the VeriSign Secured Seal, SSL certificates and Fraud Protection Services, businesses and end users can safely take advantage of the Internets full potential.

Gateway The ISIB draws from comprehensive data gathered through VeriSign's operation of key Internet intelligence infrastructure, including DNS services, digital certificates (SSL and PKI), Managed Security Services (MSS), Payment Services and Fraud Protection Services.

Laptop Parts The purpose of this briefing is to provide a deeper understanding of evolving trends in Internet usage, security and fraud to the Internet community and to enterprise technology managers.

Software Read the complete briefing.

Hard Drives The top-10-countries-of-origin ranking is derived from sorting fraudulent transactions processed by the VeriSign Fraud Protection Services during Q4 2004. The country of origin is determined by IP Address used in the payment transaction. It is possible that hackers use proxies or break into ISP infrastructure in other countries to hide their true origin.

Electronics About VeriSign
VeriSign, Inc. (Nasdaq: VRSN) operates intelligent infrastructure services that enable businesses and individuals to find, connect, secure, and transact across todays complex, global networks. Additional news and information about the company is available at www.verisign.com.

Canon For more information, contact:
VeriSign Media Relations: Brendan P. Lewis, brlewis@verisign.com, 650-426-4470
VeriSign Investor Relations: Tom McCallum, tmccallum@verisign.com, 650-426-3744

Desktop Pc Statements in this announcement other than historical data and information constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements involve risks and uncertainties that could cause VeriSign's actual results to differ materially from those stated or implied by such forward-looking statements. The potential risks and uncertainties include, among others; the ability of VeriSign to successfully develop and market new services and customer acceptance of any new services, the risk that VeriSign's announced strategic relationships may not result in additional products, services, customers and revenues; increased competition and pricing pressures. More information about potential factors that could affect the company's business and financial results is included in VeriSign's filings with the Securities and Exchange Commission, including in the company's Annual Report on Form 10-K for the year ended December 31, 2003 and quarterly reports on Form 10-Q. VeriSign undertakes no obligation to update any of the forward-looking statements after the date of this press release.

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