Internet Security Systems(ISSX) - 500 Beiträge pro Seite

[panik]

Profile:Internet Security Systems, Inc. is a security software company engaged in information protection solutions dedicated to protecting online assets. The Company`s security management solutions include software products, managed security services and professional services that are made up of both consulting and training services. The Company offers a comprehensive line of products and services for enterprise, smaller enterprise, consumer and service provider customers. The Company provides its security management solutions in three geographic areas: the Americas (United States, Canada and Latin America), which accounted for 71% of total revenues in 2001, EMEA (Europe, Middle East and Africa), which accounted for 15% of total revenues in 2001 and Asia/Pacific Rim, which accounted of 14% of total revenues in 2001.

http://www.iss.net

[avci]

Weiter abwärts

... hieß die Tendenz der Märkte in der zurückliegenden Woche. In solchen Phasen sollten reine LONG-Trader nicht die Hände in den Schoß legen, sondern Ihre Kandidaten für die nächste Gegenbewegung suchen. Trader, die den Markt von beiden Seiten betrachten, sind sowieso immer beschäftigt ;-)

Zeit nutzen

Auch wir haben die vergangenen Tage insbesondere für die Beleuchtung eines sehr interessanten Sektors genutzt. Der Bereich IT-Sicherheit erscheint uns nach wie vor als einer der Aussichtsreichsten überhaupt. Auch unsere heutige Neuvorstellung stammt aus diesem Sektor. Was man sich wünscht

Eine Aktie, die die Bewegungen des Marktes überproportional nachvollzieht - das ist der Traum, der Traderherzen höher schlagen läßt. Und genau so ein "Wunschkind" haben wir wieder einmal gefunden:

Internet Security Systems
US-Symbol: ISSX
Deutsche WKN: 912762

Was man sich wünscht

Eine Aktie, die die Bewegungen des Marktes überproportional nachvollzieht - das ist der Traum, der Traderherzen höher schlagen läßt. Und genau so ein "Wunschkind" haben wir wieder einmal gefunden:

Internet Security Systems
US-Symbol: ISSY
Deutsche WKN: 912762

Volatilitätsmonster

Eine Vervierfachung und eine Viertelung innerhalb weniger Wochen - ein Leichtes für die Papiere von Internet Security Systems. Diese Aktie eignet sich also hervorragend für risikoaffine Trader.

Ein Blick auf die aktuelle Situation

Aktuell ist es spannend. Im Zuge der Marktbewegung ging es deutlich abwärts und der Titel notiert nun in der Nähe wichtiger Unterstützungsniveaus. Der Stochastics ist überverkauft, während sich der OBV erstaunlich gut "gehalten" hat. Also gute Zeichen für einen baldigen Rebound.

Was tun?

Wir würden den Titel auf die Watchlist nehmen und bei einer eventuellen Erholung prozyklisch einsteigen. Bei den rasanten Bewegungen, die dieses "Momentummonster" auf´s Parkett legt, sollte es nicht stören, wenn man 10 Prozent verpaßt und dafür ein wenig mehr "Sicherheit" einkauft.

[panik]

Dow Jones Business News
Hacker Exploits Microsoft Flaw to Get Into Army Servers
Monday March 17, 7:28 pm ET
By Riva Richmond


NEW YORK -- At least two U.S. Army Web servers were attacked last Tuesday by a hacker or hacker group exploiting a previously unknown programming flaw in Microsoft Corp.`s Windows 2000 software, according to security-services company TruSecure Corp.
ADVERTISEMENT


TruSecure discovered the attack Tuesday while conducting routine intelligence gathering on the hacker community, said Russ Cooper, TruSecure`s surgeon general. The private Reston, Va., firm kept the information confidential until Microsoft could provide customers with a fix for the flaw, which it did Monday.

"Everything indicates that only Army sites were attacked," said Mr. Cooper. Though the attack appeared to be targeted, he had no evidence it was the work of terrorists or a foreign government.

Iain Mulholland, security-program manager at the Microsoft Security Response Center said a customer, which he declined to name, informed Microsoft Wednesday evening of an attack affecting IIS servers. He added the company has only received "isolated" attack reports, and law enforcement has launched an investigation.

An Army spokesman couldn`t immediately comment on the matter.

Microsoft posted a "critical" security alert on its Web site ( www.microsoft.com/security) Monday, as well as a patch for the flaw and advice on several temporary workarounds for customers who can`t immediately apply the patch.

Concern at Microsoft and Internet-security firms runs high because the attack targeted what was an unknown flaw, a phenomenon security experts call a "zero- day attack." Such attacks are rare and suggest a potentially short window of time until an automated worm could be developed to quickly cripple millions of machines.

"Zero-days are really, really bad," said Mr. Cooper. "It`s very likely an en masse exploitation is going to occur, in my opinion," and perhaps in as little as seven to 10 days. Worms that follow the revelation of a flaw typically don`t emerge for at least three to four weeks, he said.

The software flaw the hacker exploited was an unchecked buffer, or memory area, in the Windows component of WebDAV, an extension to the HTTP protocol that allows users in different locations to work together on the development of Web content.

By using WebDAV to flood the memory area with an extra-long Web address, or URL, the attacker was able to execute a program that gave him full control over IIS 5.0 servers, including the ability to infiltrate other computers on its network, plant backdoors and run any programs of his choice.

Mr. Cooper said the hacker that infiltrated the Army servers was mapping the network "to see where else to go" when he was discovered. He added the hacker was also sending server data out through port TCP 3389, which carries a lot of encrypted traffic, making it a good place to hide.

Internet Security Systems Inc. (NasdaqNM:ISSX - News) may have provided the army`s intrusion- detection software. Chris Rouland, director of its research arm, X-Force, said a customer it wouldn`t name was affected. He added the software detected the attack using protocol-anomaly technology that took note of unusually long Web addresses, which stretched to nearly 50,000 characters.

Mr. Rouland also said his company had no information suggesting the attack was an event of cyberterror or cyberwar.

Companies who aren`t immediately able to apply Microsoft`s patch are urged by Microsoft, TruSecure and Internet Security Systems to immediately disable WebDAV if they don`t need it. Customers can also download a tool from Microsoft called URLScan that will reject URLs that are unusually long. Furthermore, users can use Microsoft`s IIS Lockdown tool to upgrade the security of their Web servers.

-Riva Richmond, Dow Jones Newswires; 201-938-5670; [e-mail]

[cosine]

Hackings rise as war rages

War of the words takes to the Internet as both sides of the Iraq conflict deface popular sites.
March 21, 2003: 1:17 PM EST



LONDON (Reuters) - As bombs continue to fall in Iraq, protesters and patriotic hackers alike have stepped up their war of words on the Internet, defacing hundreds of U.S. and U.K. corporate and government Web sites, a security expert said Friday.

We`ve had reports of 800 defacements today, which is ten times more than a week ago, which tells me groups are increasingly turning to the Internet to protest," said Mikko Hypponen, manager of Finnish antivirus software firm F-Secure.

The messages run the gamut, ranging from words of support for American and British troops to anger over the military campaign. Victims vary from a U.S. Navy Web site to the homepage for U.K. industrial products distributor Routeco.

According to pictures captured on F-Secure`s Web site, the Routeco home page carried a photo of protestors burning an American flag. Underneath the image, a message read: "Ohh YeaH BabY...Ur SiTe Has BeeN DeFaceD."

The Web site was back to normal by mid-day Thursday, a computer consultant for Routeco told Reuters.

The site for freight forwarder and shipping agency Seaborne Co. Ltd. was also hit by war protesters, quoting the Koran. It also issued the ominous warning: "It`s The New Era of Cyber War We Promised!"

Groups with a strong political bent increasingly have been using Web site defacement and crude hacking techniques as methods of protest.

Like graffiti, defaced Web sites are considered little more than a nuisance. The message tends to get wide exposure, but the damage to the victim is minimal. Web site operators typically have the site restored within a matter of hours.

"This is the work of individual groups. We haven`t seen any signs of state-sponsored network [intrusions]," Hypponen said.

Hypponen said security firms have been staffing up to handle the more damaging potential cyber attacks: e-mail-based worms or viruses. A new e-mail worm, dubbed Ganda-A, surfaced this week in Europe, purporting to show screen savers of U.S. spy satellite pictures of Iraq or animations that are either patriotic or that mock President Bush.

The worm spreads by sending itself to e-mail addresses on an infected machine and tries to disable anti-virus and other security software and infect certain files on the hard disk.

Hypponen said the worm was petering out Friday. Still, his team remains on the ready.

"We doubled our on-call staff. We are prepared if anything happens. So far, nothing has," he said.

[avci]

8:36AM CSFB cuts estimates for Internet Security Sys, Check Point : CSFB cuts 2003-04 ests for ISSX and CHKP. Firm views ISSX as one of the vendors most at risk for a shortfall in the March qtr due to the geopolitical environment, and cuts 2003 est to $0.56 from $0.67 and 2004 to $0.62 from $0.78 (below consensus of $0.63 and $0.76). Regarding CHKP, in addition to geopolitical concerns, firm says their survey and channel checks indicate CHKP`s competitive position has eroded over the past 6 months; cuts 2003 est to $0.97 from $1.00 and 2004 to $1.04 from $1.12 (consensus $1.01 and $1.09).

[avci]

8:22AM Network Assoc`s acquisition of IntruVert a negative for Internet Security Sys - UBS (ISSX) 10.19: UBS Warburg believes that NET`s acquisition of IntruVert is a clear negative for ISSX, as IntruVert has well-regarded IDS technology that, once integrated with NET`s strong direct sales force and distribution, should competitively weaken ISSX longer-term; firm also notes that the uncertainty remains as to whether or not ISSX can meet Q1 ests, when ISSX`s troubled Asia/Pacific biz can recover, and when ISSX can show notable improvement in license rev; trims price target to $11.50 from $12.

[avci]

Internet Security Systems Schedules First Quarter Earnings Announcement For April 17, 2003 and Provides Current Financial Expectations
Thursday April 3, 4:17 pm ET


ATLANTA, April 3 /PRNewswire-FirstCall/ -- Internet Security Systems, Inc. (Nasdaq: ISSX - News; ISS) today announced its intent to release financial results for the quarterly period ended March 31, 2003, on Thursday, April 17, 2003, after the stock market close at approximately 4:00 p.m. Eastern Standard time.
The company is currently consolidating its worldwide results. Revenues are expected to be slightly above the revenues for the year-ago quarter ended March 31, 2002 of $58.4 million. Pro forma earnings per share are expected to be in the range of $0.12 to $0.13 per diluted share. The low-end of previously provided expectations were $61 million in revenues and pro forma earnings of $0.13 per diluted share. Pro forma earnings per diluted share exclude non-cash acquisition related charges of approximately $1.4 million, consisting of amortization of intangibles and compensation charges for unvested stock options, and the tax effect of this adjustment. This is anticipated to result in expected GAAP earnings per diluted share of between $0.10 to $0.11 per diluted share.

ISS will keep this press release and published expectations publicly available on its Web site (www.iss.net ). The public can continue to rely on the expectations published in this press release as being its current expectations on matters covered, unless ISS publishes a notice stating otherwise. The public should no longer rely on ISS` previous outlook for the year. ISS anticipates updating its outlook for the fiscal year ending December 31, 2003 in its earnings release scheduled for April 17, 2003.

A conference call led by Tom Noonan, ISS president and chief executive officer, and Rich Macchia, ISS chief financial officer, will be held at 4:30 p.m. following the announcement of financial results on April 17, 2003.

Details of the conference call are as follows:

DATE/TIME: Thursday, April 17, 2003 at 4:30 p.m. Eastern

DIAL IN:
Domestic 888-809-8970
International 712-257-3322
Passcode ISSX (or 4779)


A live Webcast of this conference call will be available at www.iss.net (click on About ISS, then Investor Relations, then Conference Calls) and will remain accessible until May 31, 2003. A rebroadcast of the teleconference will be available from 5:00 p.m., April 17 until 5:00 p.m., April 24, 2003.

REBROADCAST DIAL IN:
Domestic 800-867-1934
International 402-280-1687
Passcode ISSX (or 4779)
Additional investor information can be accessed on the Internet Security Systems web site or by contacting the Investor Relations department at 888- 901-7477.

About Internet Security Systems, Inc.

Internet Security Systems, Inc. (ISS) (Nasdaq: ISSX - News) is a world leader in software and services that protect critical information assets from an ever- changing spectrum of threats and misuse. Software from Internet Security Systems dynamically detects, prevents and responds to sophisticated threats to networks, servers and desktops. Services include 24/7 system monitoring, emergency response and access to the X-Force, Internet Security Systems` renowned research and development team. Internet Security Systems is the trusted security provider for more than 11,000 corporate customers, including all of the Fortune 50, the top 10 largest U.S. securities firms, 10 of the world`s largest telecommunications companies and major agencies and departments within U.S. local, state and federal governments. Headquartered in Atlanta, GA, Internet Security Systems has additional operations throughout the Americas, Asia, Australia, Europe and the Middle East. For more information, visit the Internet Security Systems Web site at www.iss.net or call 888-901-7477.

Forward-Looking Statements and Pro Forma Results

This release, other than historical information, includes forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include those relating to ISS` expected results for the first quarter. The risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, ISS` verification, evaluation and consolidation of financial information from its various operations. Risk factors are discussed in ISS` periodic filings with the Securities and Exchange Commission, including ISS` 2002 Annual Report on Form 10-K. These filings can be obtained either by contacting ISS Investor Relations or through the Securities and Exchange Commission`s Web site at http://www.sec.gov.

ISS believes that Pro Forma Earnings, excluding the after-tax effect of non-cash acquisition charges, is an additional meaningful measure of operating performance. However, this pro forma information will necessarily be different from comparable information provided by other companies and should not be used as an alternative to our operating and other financial information as determined under accounting principles generally accepted in the United States of America.

Internet Security Systems is a trademark of Internet Security Systems, Inc.




--------------------------------------------------------------------------------
Source: Internet Security Systems, Inc.

[cosine]

Internet Security Systems` X-Force Releases Internet Risk Impact Summary Report for Q1 2003
Monday April 7, 7:45 am ET
Online Security Events Increase Ten-fold, Incidents With Unusual Risk and Confirmed Attack Rise 84 Percent


ATLANTA, April 7 /PRNewswire-FirstCall/ -- Internet Security Systems, Inc. (ISS) (Nasdaq: ISSX - News), today released its Internet Risk Impact Summary Report (IRIS) for the first quarter of 2003, which reveals a 84 percent increase in the number of security incidents and confirmed attacks from the prior fourth quarter of 2002. The increase in security incidents was coupled with a tremendous jump in overall security events, equaling ten times the amount of events in the fourth quarter of 2002. This spike in security events, typically in the form of suspicious activities like automatic probing and scanning for vulnerabilities in computer systems, directly correlates to a major increase in the number of new worms and hybrid threats tracked in the first quarter of 2003, which totaled 752 compared to 101 in the fourth quarter of 2002.
"The large increase in mass mailing, highly persistent worms and security events indicates that this year will be challenging for security officers and administrators around the world. These levels are consistent with our forecasts that show a steady amount of malicious activity on the Internet throughout 2003," said Chris Rouland, director of Internet Security Systems` X-Force(TM) security research and knowledge services organization. "Hackers, criminals and hactivists continue to disrupt services, commit online theft, and cause outages across the Internet by exploiting unprotected computers, especially by focusing their activities on critical and widely-deployed systems and infrastructure."

Internet Security Systems` IRIS is the only quarterly report to provide cyber attack trends based on factors such as the industry`s largest number of monitored security devices, actual attacks detected and researched vulnerabilities.

Highlights and Report Findings:
* Security Events: 26 percent of security events occurred over weekends
in the first quarter of 2003 as compared to 23 percent in the fourth
quarter. Friday showed the highest rate of security events throughout
the quarter, registering an average 2,301,777. The Slammer worm
discovered by ISS X-Force began its propagation on Saturday, January
25th.

The top two attack categories for security events include suspicious
activity accounting for 73.5 percent of total events, and unauthorized
access attempts at 11 percent.

After tracking 20 industry sectors targeted by attacks in the first
quarter, the following major industries ranked in the following order
of most to least attacked. Retail -- 35 percent; Financial Services
-- 11.5 percent; Healthcare -- 9 percent; Manufacturing -- 9 percent;
Federal and Local Government 1 -- percent.

* Vulnerabilities: ISS added 606 new vulnerabilities to the X-Force
database, a decrease compared to Q4 2002 when 644 new vulnerabilities
where added.

The vulnerabilities for Q1 2003 were classified into the following risk
levels: 156 High, 341 Medium and 109 Low. High security issues are
those that allow immediate remote or local access, or immediate
execution of code or commands with unauthorized privileges.

* Worms and Hybrid Threats: The number of threats outpaced
vulnerabilities discovered 752 to 606 in Q1 2003. This statistic
reveals a new security trend, which demonstrates that exploit
development from the hacking underground is catching up with security
research. This trend was observed with the recent X-Force alert on
March 17th, documenting a vulnerability within the WebDAV component of
Microsoft IIS Web server. Experts often describe this condition as
"zero-day" attacks, or attacks against software vulnerabilities not yet
known by software vendors.

* AlertCon(TM) Risk Levels: During the first quarter of 2003, ISS
observed 67 days at AlertCon 1, 19 days at AlertCon 2, and 3 days at
AlertCon 3 and 1 day at AlertCon 4, which is dedicated for the most
severe attacks.

The X-Force changed to AlertCon 3 and 4 during the propagation of the
Slammer worm and also observed AlertCon 3 during the disclosure of a
vulnerability it discovered in the Sendmail mail transfer agent, and
the subsequent exploit published by a third party on a popular online
security forum.


How to Participate in ISS` IRIS Report Webinar at 2 p.m. ET Today


ISS will be hosting a Webinar on the findings of this quarter`s IRIS Report this afternoon at 2:00 p.m. ET / 11:00 a.m. PT. Following is information on how to participate in ISS` IRIS Report Webinar:

Connection test:

Verify your ability to connect to the show by performing a connection test. Click on the following URL:

http://invite.Mshow.com/signon.asp?Cobrand=100&usertype=0&Sh…

Be patient, it may take a minute or longer to load the application. Fill in the appropriate fields and click "Logon." If you are unable to connect successfully, please contact the technical support desk at 888-865-7469 or [phone].

Joining the live event:

Log onto the live event by clicking on the following Event URL approximately 10 minutes before the scheduled time.

Event URL:
http://invite.Mshow.com/signon.asp?Cobrand=100&usertype=0&Sh…


DON`T FORGET ABOUT THE AUDIO PORTION!
There are two audio options for this MSHOW:


To listen via the Internet:

If your computer has speakers, select the streaming audio option when you join the show.

Note -- Your computer will require either Real Player or Windows Media Player and a sound card in order to use this feature.

To listen via the phone -- At show time, call one of the teleconference numbers listed below and follow the operator`s instructions.

US and Canada: 877-356-6563
International: [phone]
Your Show Number is 99251
For technical support, please dial 888-865-7469 or [phone].

The complete Q1 2003 Internet Risk Impact Summary Report is available for free download on Internet Security Systems` Web site at https://gtoc.iss.net/ . For more information on the latest security protection including response strategies to hybrid threats, the following white papers are available online at http://documents.iss.net/whitepapers/DynamicThreatProtection… and http://www.iss.net/support/documentation/otherwhitepapers.ph… .

X-Force Internet Risk Impact Summary Report Methodology

Developed by the X-Force, Internet Security Systems` world-leading security research organization and core protection knowledge base, each IRIS report includes statistical data and trend analysis derived from examining more than 400 network and server-based intrusion detection sensors. This data was gathered on a 24/7 basis from January 1 to March 31, 2003. This international sample is drawn from four continents and represents all major industries including banking/insurance, telecommunications, manufacturing/retail/food, entertainment, healthcare, government, utilities, transportation/aviation, and information technology. In operation since 2001, Internet Security Systems` X-Force Global Threat Operations Center (GTOC) based in Atlanta analyzes the security data for this report gathered from ISS` five security operations centers (SOCs) located around the world. The IRIS report also includes X-Force laboratory research, and industry information gathered from interaction with top government, industry, and academic sources to detail the most accurate and holistic Internet threat assessment in the industry.

About Internet Security Systems` X-Force Protection Services

Internet Security Systems` X-Force is a world-leading organization of security experts dedicated to researching, alerting and educating customers, partners and the public on the state of global Internet threats and attacks. The X-Force identifies, assesses, and measures the severity of Internet threats and vulnerabilities and monitors security incidents through its leading managed security services. X-Force Protection Services also includes Internet Security Systems` consulting and professional services offerings -- security assessments, penetration testing and emergency response services. X-Force findings accompanied by technical recommendations and protection strategies as well as other industry alerts and advisories are available through Internet Security Systems` online security center (http://www.iss.net/security_center/).

Located at Internet Security Systems` headquarters in Atlanta, the Internet Security Systems X-Force Global Threat Operations Center (GTOC) globally coordinates security threat data, and disseminates critical countermeasure intelligence worldwide. The GTOC hosts the Internet Security Systems Atlanta Security Operations Center, providing 24/7 security monitoring and management. The X-Force Daily AlertCon, a measure of current and forecasted Internet threats, is available on the ISS web site www.iss.net . Determined by the X-Force, the AlertCon level (1-4) provides a real-time indication of the Internet threat environment. The daily AlertCon level allows a customer to quickly determine the prevailing Internet threat condition and review critical security details.

About Internet Security Systems, Inc.

Internet Security Systems, Inc. (ISS) (Nasdaq: ISSX - News) is a world leader in software and services that protect critical information assets from an ever- changing spectrum of threats and misuse. Software from Internet Security Systems dynamically detects, prevents and responds to sophisticated threats to networks, servers and desktops. Services include 24/7 system monitoring, emergency response and access to the X-Force, Internet Security Systems` renowned research and development team. Internet Security Systems is the trusted security provider for more than 10,000 corporate customers, including all of the Fortune 50, the top 10 largest U.S. securities firms, 10 of the world`s largest telecommunications companies and major agencies and departments within U.S. local, state and federal governments. Headquartered in Atlanta, GA, Internet Security Systems has additional operations throughout the Americas, Asia, Australia, Europe and the Middle East. For more information, visit the Internet Security Systems Web site at www.iss.net or call 888-901-7477.

Internet Security Systems and X-Force are trademarks, and AlertCon, a service mark, of Internet Security Systems, Inc. All other companies and products mentioned are trademarks and property of their respective owners.




--------------------------------------------------------------------------------
Source: Internet Security Systems, Inc.

[avci]

Internet Security Systems Introduces Proventia Family of Protection Appliances To Identify and Prevent All Forms of Network Attack
Monday April 14, 7:45 am ET
Designed to Eliminate the Need for Standalone Firewalls and Gateway Anti-virus


ATLANTA, April 14 /PRNewswire-FirstCall/ -- Internet Security Systems, Inc. (ISS) (Nasdaq: ISSX - News) today announced the company`s entry into the security appliance market with the introduction of its Proventia(TM) family of network protection appliances. Internet Security Systems` Proventia appliances are an integral component of ISS` Dynamic Threat Protection(TM) enterprise security platform, providing customers with maximum protection for the best value. Proventia appliances will feature unified, multi-function protection capabilities designed to identify and prevent all forms of attack with minimal user intervention. They are optimized for the most demanding network environments yet easy to deploy, easy to use and centrally managed, making them extremely cost-effective.
Today, ISS also introduced the first line in the Proventia product family, the Proventia A Series. ISS intends to deliver additional Proventia appliance series with ever-increasing protection and prevention capabilities including inline prevention at multi-gigabit speeds in the next quarter. By the end of 2003, ISS expects to introduce a series of Proventia appliances that unifies multi-function protection technologies including inline prevention, firewall, VPN, gateway anti-virus and spam filtering into a single appliance managed by one, central management system. This series is designed to eliminate the need for managing and maintaining such technologies in multiple standalone forms.

"ISS` Proventia appliances are intended to give customers a single point of protection to prevent all forms of attack, eliminating the need for standalone firewalls, gateway anti-virus and other traditional point technologies that alone fail to provide complete protection against today`s complex threats," said Tom Noonan, Internet Security Systems` president and chief executive. "With Proventia, we are simplifying the role of security for our customers, enabling them to focus on their core business operations with the peace of mind that they are protected by ISS."

Proventia appliances are based on ISS` market-leading protection technology. Backed by ISS` world-renowned X-Force(TM) research and development team, this technology combines advanced protocol analysis with a large library of pattern-matching algorithms to protect against threats that other intrusion detection systems, standalone firewalls and anti-virus products never even see. ISS` ability to accurately detect threats lays the foundation for Proventia`s inline prevention capabilities and sets it apart from other inline products that plague enterprises by erroneously blocking legitimate traffic.

"By 2007 we believe that roughly 80 percent of all security products will be delivered in an appliance," said Charles Kolodgy, research director at IDC. "ISS has enjoyed success as the worldwide market leader in the network intrusion detection software market and is it effectively positioning itself to succeed in the security appliance market with its launch of Proventia."

ISS Proventia Appliances A Series Inline Multi-
series function
series

Maximum Aggregate
Bandwidth 1200 Mbps 2000 Mbps Gigabit TBD

Maximum Protected
Segments 4 1 Multiple TBD

Based on RealSecure
Technology X X X

DDoS Protection X X X

Inline Prevention X X

Stateful Packet
Filter Firewall X X

Stateful Application
Firewall X X

VPN Gateway X

Gateway Anti-virus X

Spam Filter X

Centralized Management X X X

Expected Availability
in the Americas Today Q3 2003 Q4 2003


Centrally Managed by ISS SiteProtector Management System

Proventia appliances complement ISS` existing RealSecure® products and share common management through ISS` SiteProtector(TM) centralized management system. The SiteProtector management system enables customers to control, monitor and analyze events from all ISS network, server and desktop protection offerings with minimal staffing and operational costs. ISS also provides optional X-Force Managed Protection Services for Proventia customers who prefer to utilize their internal resources elsewhere and let ISS` experts monitor and manage their systems 24/7.

As with all ISS offerings, Proventia appliances receive automatic X- Press(TM) Update product enhancements from security intelligence gathered and analyzed by the X-Force. These updates can be centrally deployed and provide Proventia appliances with the most up-to-date and first-to-know protection possible. To learn more, visit www.iss.net/proventia .

About Internet Security Systems, Inc.

Internet Security Systems, Inc. (ISS) is a world leader in Dynamic Threat Protection products and services that protect critical information assets from an ever-changing spectrum of threats and misuse. Products from Internet Security Systems dynamically detect, prevent and respond to sophisticated threats to networks, servers and desktops. Services include 24/7 system monitoring, emergency response and access to the X-Force, Internet Security Systems` renowned research an development team. Internet Security Systems is the trusted security provider for more than 11,000 corporate customers, including all of the Fortune 50, the top 10 largest U.S. securities firms, 10 of the world`s largest telecommunications companies and major agencies and departments within U.S. local, state and federal governments. Headquartered in Atlanta, Internet Security Systems has additional operations throughout the Americas, Asia, Australia, Europe and the Middle East. For more information, visit the Internet Security Systems Web site at www.iss.net or call 888-901-7477.

This release, other than historical information, includes forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Some of these forward-looking statements include those describing future products and attributes of products not yet released. The risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the following: the level of demand for ISS` products; product and price competition; ISS` ability to develop new and enhanced products; the extent to which unauthorized access to and use of online information is perceived as a threat to network security; customer budgets; the assertion of infringement claims with respect to ISS` intellectual property; and risks concerning the rapid change of technology; and general economic factors. These risks and others are discussed in ISS` periodic filings with the Securities and Exchange Commission. These filings can be obtained either by contacting ISS Investor Relations or through the Securities and Exchange Commission`s Web site at "http://www.sec.gov".

Internet Security Systems, Proventia, Dynamic Threat Protection, X-Force are trademarks and RealSecure is a registered trademark of Internet Security Systems, Inc. All other companies and products mentioned are trademarks and property of their respective owners.




--------------------------------------------------------------------------------
Source: Internet Security Systems, Inc.

[panik]

Spending on Net security looks upbeat

By Bambi Francisco, CBS.MarketWatch.com
Last Update: 4:07 PM ET April 16, 2003







SAN FRANCISCO (CBS.MW) -- The U.S. threat level dropped to yellow from orange on Wednesday, but the security threat on the Internet remains high.

That`s why spending to secure the Internet is a top priority if the government plans to get e-connected.

"Part of what e-government is going to be is transferring personal information across the Internet," said Payton Smith, manager of federal market analysis at Input, a market resource for companies seeking to do business with the government. "People are still sensitive about transmitting personal information over the Internet ... The first step in enabling e-government applications is to make the networks secure."

Spending on cyber security has grown dramatically since 2001. According to Smith, federal spending stood at $1.3 billion in that fiscal year, prior to the terrorist attacks. That spending is earmarked in the White House budget to be $4.7 billion in fiscal 2004, up from $4.2 billion in fiscal 2003.

Now, it`s not easy to predict a year out, much less five years.

But according to Smith`s crystal ball, federal government spending on information technology and services is forecast to grow at a compounded annual rate of 8.5 percent.

Spending on services and technology across all federal agencies could reach $68.2 billion in 2008 from $45.4 billion in fiscal year 2003. Spending on cyber security is forecast to grow at a compounded annual growth rate of 7 percent to $5.9 billion in 2008.

Even if that growth rate is way off -- as ultimately most predictions tend to be -- spending from the government still looks relatively upbeat. Of course, that`s not too difficult these days.

Fed spending on tech is growing faster than the U.S. economy, spending on personal computers and telecom. The U.S. economy is expected (by some estimates) to grow by 3 percent this year. On a global basis, spending on telecom capital equipment is expected to fall 6 percent this year. Growth in personal computer units is expected to grow by 7 to 8 percent this year, according to an earlier Gartner survey. But PC revenue is only expected to grow by 2 to 3 percent.

The areas that are expected to receive the most attention are homeland security and e-government initiatives. Federal divisions with the greatest spending include Department of Defense, Homeland Security, Department of Transportation, Department of Energy and Department of Treasury. These five departments will represent nearly 70 percent of federal spending in tech services through fiscal 2008.

Of the spending on cyber security, $900 million is still earmarked over five years to promote cyber security research and development, Howard Schmidt, the government`s cyber security adviser and formerly Microsoft`s chief security officer, said Tuesday in an interview with CBS.MarketWatch.com.

See interview with Schmidt and TechNet CEO Rick White on Yahoo`s (YHOO: news, chart, profile) Yahoo Platinum. Click here.

Schmidt, who attended the RSA Securities (RSAS: news, chart, profile) 2003 conference in San Francisco, said the spending has been authorized, but not yet appropriated. The funding for cyber security was announced last November. Smith joined TechNet CEO Rick White and other executives to announce that the auditing business and other major corporations are building security awareness within the private sector. See full story.

Government reliance

Government spending already accounts for a large percentage of sales in the securities industry, according to RBC Capital Markets` estimates from the fall of last year.

Internet Security Systems (ISSX: news, chart, profile) generates about 20 to 25 percent of its license sales from the government sector. VeriSign (VRSN: news, chart, profile) generates about 8 to 10 percent; Symantec (SYMC: news, chart, profile) generates about 10 to 20 percent; Check Point (CHKP: news, chart, profile) generates about 5 to 8 percent. Network Associates (NET: news, chart, profile) relies on the government for about 8 to 12 percent of sales while Websense (WBSN: news, chart, profile) generates about 6 to 8 percent of sales from the government. Netegrity generates 5 to 12 percent, and WatchGuard generates about 5 percent of revenue from the government.

Free e-newsletter delivery

Bambi Francisco`s Net Stocks is available free daily via e-mail. Sign up for Bambi Francisco`s Net Stocks at CBS.MarketWatch.com. You can also subscribe to Bambi Francisco`s Net Sense, a weekly commentary. A new independent research model.

Bambi Francisco is Internet editor of CBS.MarketWatch.com, based in San Francisco.

[panik]

Internet Security Systems Reports First Quarter Results; Also Provides Updated Guidance
Thursday April 17, 4:17 pm ET


ATLANTA, April 17 /PRNewswire-FirstCall/ -- Internet Security Systems, Inc. (Nasdaq: ISSX - News), a leading global provider of enterprise security solutions, today announced financial results for the first quarter ended March 31, 2003. Additionally, the Company is providing its business outlook for the second quarter ending June 30, 2003 and updating its outlook for the full year.
ADVERTISEMENT


First Quarter 2003 Revenues

Revenues were $59,453,000 for the first quarter of 2003, a 2% increase compared with first quarter 2002 revenues of $58,377,000 and a 6% decrease compared with revenues of $63,109,000 for the fourth quarter of 2002.

GAAP Earnings

Reported net income under generally accepted accounting principles (GAAP) for the first quarter of 2003 was $5,362,000, or $.11 per diluted share, compared to net income of $3,369,000 or $.07 per diluted share, in the first quarter of 2002 and a net loss of $12,056,000, or $.25 per diluted share, in the fourth quarter of 2002.

Pro Forma Earnings

Pro forma net income for the first quarter of 2003 was $6,464,000, or $.13 per diluted share, compared to $4,723,000, or $.10 per diluted share, in the first quarter of 2002 and $7,444,000, or $.15 per diluted share, in the fourth quarter of 2002.

Pro forma net income excludes the after-tax impact of non-cash acquisition expense for amortization of intangibles, compensation charges for unvested stock options and in-process research and development, as stated and reconciled on the accompanying Consolidated Statements of Operations.

"We are pleased with our overall results this quarter and especially excited by the tremendous level of interest in our new Proventia lines of Dynamic Threat Protection products," said Tom Noonan, chairman, president and chief executive officer of Internet Security Systems. "Our customers desire more simplified and cost-effective approaches to enterprise security, but they are unwilling to compromise on the best of breed capabilities to detect and prevent the ever-changing threats that are more destructive than ever."

Business Highlights to Date

ISS continues to distinguish itself from its competitors by providing the most up-to-date and first-to-know protection through its world-renowned X- Force(TM) research and development team. In the first quarter, ISS researched more than 1,350 new worms and vulnerabilities for the protection of its customers, including the well-publicized SQL Slammer, Sendmail and WebDAV attacks. ISS` X-Force organization was the first to detect, name and initiate analysis of the SQL Slammer worm, pioneered the discovery of a serious vulnerability in Sendmail and initiated analysis that confirmed a serious vulnerability in WebDAV on the vendor`s behalf. In each of these cases, ISS was one of only a handful of vendors to provide its customers with an effective solution to protect them from these critical threats.

ISS extended its presence in the security appliance market by introducing the first series in its Proventia(TM) family of protection appliances, the Proventia A Series. ISS Proventia A Series appliances deliver ISS` advanced network protection in a way that significantly reduces the time and effort customers traditionally spend acquiring and deploying protection software and hardware, freeing valuable IT resources for more critical projects. The Proventia A Series is another significant component of Internet Security Systems` Dynamic Threat Protection(TM) enterprise security platform and maximizes ISS customers` existing security investment by working cohesively with ISS` RealSecure®, Internet Scanner® and SiteProtector(TM) offerings.

ISS selected Global Knowledge, a global provider of IT education and training solutions, as its Premiere National Authorized Training Partner during the quarter. The partnership brings ISS` X-Force Education Services Authorized Training Center (ATC) Program to new markets throughout the United States.

Internet Security Systems also appointed Heath Thompson to vice president, engineering. Mr. Thompson has been associated with ISS for several years as a consultant and brings to the company a wealth of security technology knowledge, experience and familiarity with the ISS engineering organization. Greg Gilliom, former vice president of engineering, continues with ISS in the role of technology strategist.

Updated Business Outlook for 2003

The following statements are based on current expectations for the second quarter and fiscal year 2003 regarding ISS` revenues and earnings per share. These statements are forward-looking, and actual results may differ materially. These statements do not reflect the potential impact of any mergers, acquisitions or other business combinations that may be completed after the date of this release. ISS will keep its earnings release and published expectations publicly available on its web site (www.iss.net). Prior to the start of ISS` quiet period, the public can continue to rely on the expectations published in this earnings release and web site as being its current expectations on matters covered, unless ISS publishes a notice stating otherwise. Towards the end of each fiscal quarter, ISS will have a "quiet period" when ISS and its representatives will not comment concerning previously published financial expectations, and we disclaim any obligation to update during the quiet period. The public should not rely on previously published expectations during the quiet period. ISS` quiet period at the end of the second quarter is expected to run from June 15, 2003 until the earnings are released in July 2003.

Coming off the difficult first quarter, ISS built this guidance on the premise that the enterprise-spending environment will remain difficult for most of the balance of 2003. Accordingly, ISS intends to continue its focus on business efficiencies until such time as there are indications that spending intentions are strengthening. Our guidance reflects this emphasis as earnings per share is expected to grow faster than revenues in 2003.

For the year ending December 31, 2003, ISS is updating its guidance to revenues in the range of $248,000,000 to $260,000,000 and pro forma net income of $.57 to $.65 per diluted share. For the quarter ending June 30, 2003, ISS currently expects to achieve revenues in the range of $60,000,000 to $64,000,000 and pro forma net income in the range of $.13 to $.15 per diluted share. Pro forma net income excludes the after-tax impact of non-cash acquisition related expenses, as stated and reconciled in the accompanying Business Outlook Reconciliation table.

Earnings Conference Call

The Company`s conference call regarding this press release is being held April 17, 2003, at 4:30 p.m. Eastern Daylight Time and can be accessed as follows:

DATE/TIME: Thursday, April 17, 2003 at 4:30 p.m. Eastern

DIAL IN:
Domestic 888-809-8970
International 712-257-3322
Passcode ISSX (or 4779)



A live Webcast of this conference call will be available at www.iss.net (click
on About ISS, then Investor Relations, then Conference Calls) and will remain
accessible until May 31, 2003. A rebroadcast of the teleconference will be
available from 5:00 p.m., April 17 until 5:00 p.m., April 24, 2003.
REBROADCAST DIAL IN:
Domestic 800-867-1934
International 402-280-1687
Passcode ISSX (or 4779)

Additional investor information can be accessed on the Internet Security
Systems web site or by contacting the Investor Relations department at
888-901-7477.

About Internet Security Systems, Inc.

Internet Security Systems, Inc. is a world leader in Dynamic Threat Protection products and services that protect critical information assets from an ever-changing spectrum of threats and misuse. Products from Internet Security Systems dynamically detect, prevent and respond to sophisticated threats to networks, servers and desktops. Services include 24/7 system monitoring, emergency response and access to the X-Force, Internet Security Systems` renowned research and development team. Internet Security Systems is the trusted security provider for more than 11,000 corporate customers, including all of the Fortune 50, the top 10 largest U.S. securities firms, 10 of the world`s largest telecommunications companies and major agencies and departments within U.S. local, state and federal governments. Headquartered in Atlanta, Internet Security Systems has additional operations throughout the Americas, Asia, Australia, Europe and the Middle East. For more information, visit the Internet Security Systems Web site at www.iss.net or call 888-901-7477.

Forward-Looking Statements and Pro Forma Results

This release, other than historical information, includes forward-looking statements made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Some of these forward-looking statements include our Business Outlook and statements regarding transactions not yet completed, new products, products under development and related plans. The risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the following: the level of demand for ISS` products; customer budgets; the volume and timing of orders; product and price competition; ISS` ability to develop new and enhanced products; acceptance of new and enhanced products by customers; ISS` ability to assimilate acquisitions or investments; ISS` ability to attract and retain key personnel; reliance on distribution channels through which ISS` products are sold; the growth in the acceptance and use of the Internet and of private Internet-based networks or "intranets"; the extent to which unauthorized access to and use of online information is perceived as a threat to network security; the assertion of infringement claims with respect to ISS` intellectual property; foreign currency exchange rates; risks concerning the rapid change of technology; and general economic factors. These risks and others are discussed in ISS` periodic filings with the Securities and Exchange Commission, including ISS` 2002 Annual Report on Form 10-K. These filings can be obtained either by contacting ISS Investor Relations or through ISS` Web site at www.iss.net or the Securities and Exchange Commission`s Web site at "http://www.sec.gov."

ISS believes that Pro Forma Earnings, excluding the after-tax effect of non-cash acquisition charges and gains related to the issuance of subsidiary shares, is an additional meaningful measure of operating performance. However, this pro forma information will necessarily be different from comparable information provided by other companies and should not be used as an alternative to our operating and other financial information as determined under accounting principles generally accepted in the United States of America. ISS believes that its presentation of pro forma earnings and pro forma operating margin provides useful information to investors as a measure of operating performance basic to the its ongoing operations, which is more comparable from period to period without the charges related to occasional acquisition activity. ISS uses the pro forma earnings measure to provide its forward-looking guidance and compare with financial analysts estimates, and uses pro forma earnings and operating margin measures to evaluate its internal performance, including as a basis for calculating incentive compensation.

Internet Security Systems, X-Force, Dynamic Threat Protection, Proventia and SiteProtector are trademarks, and RealSecure and Internet Scanner are registered trademarks of Internet Security Systems, Inc. All other companies and products mentioned are trademarks and property of their respective owners.

INTERNET SECURITY SYSTEMS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands, except per share amounts)
(unaudited)


Three months ended
March 31, December 31, March 31,
2003 2002 2002

Revenues:
Product licenses and sales $26,264 $30,543 $30,213
Subscriptions 26,898 25,682 20,322
Professional services 6,291 6,884 7,842
59,453 63,109 58,377

Costs and expenses:
Cost of revenues:
Product licenses and
sales 1,441 1,089 2,327
Subscriptions and
professional services 12,348 12,496 12,509
Total cost of revenues 13,789 13,585 14,836

Research and development 9,671 9,160 8,607
Sales and marketing 21,176 23,310 22,687
General and administrative 5,540 6,077 5,444
Charge for in-process
research & development --- 18,537 ---
Amortization of intangibles
& stock based compensation 1,404 1,388 1,496
51,580 72,057 53,070

Operating income (loss) 7,873 (8,948) 5,307

Interest income, net 643 763 730
Minority interest (88) 86 (139)
Other income (expense) 24 (45) (37)
Exchange gain (loss) 244 (150) 23
Income (loss) before income taxes 8,696 (8,294) 5,884
Provision for income taxes 3,334 3,762 2,515
Net income (loss) $5,362 $(12,056) $3,369


Basic net income (loss) per share
of Common Stock $0.11 $(0.25) $0.07
Diluted net income (loss) per
share of Common Stock $0.11 $(0.25) $0.07

Weighted average number of
shares:
Basic 49,539 49,047 48,037
Diluted 49,963 49,715 49,148



INTERNET SECURITY SYSTEMS, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(amounts in thousands, except per share amounts)
(unaudited)



Pro forma results for the three months ended March 31, 2003, December 31,
2002 and March 31, 2002 excluding amortization and stock-based
compensation expense and charge for in-process research and development:


Three months ended
March 31, December 31, March 31,
2003 2002 2002


Operating income (loss) $7,873 $(8,948) $5,307
Add back amortization of intangibles
and stock-based compensation expense 1,404 1,388 1,496
Add back charge for in-process research
& development --- 18,537 ---
Pro forma operating income 9,277 10,977 6,803
Other income, net 823 654 577
Pro forma income before taxes 10,100 11,631 7,380
Provision for income taxes 3,636 4,187 2,657
Pro forma net income $6,464 $7,444 $4,723

Pro forma operating margin 16 % 17 % 12 %
Pro forma diluted net income per share
of Common Stock $0.13 $0.15 $0.10



INTERNET SECURITY SYSTEMS, INC.
CONSOLIDATED BALANCE SHEETS
(amounts in thousands, except share amounts)

March 31, December 31,
2003 2002
ASSETS
Current assets:
Cash and cash equivalents $170,110 $148,317
Marketable securities 46,309 53,999
Accounts receivable, less allowance for
doubtful accounts of
$3,369 and $2,790 respectively 50,307 56,700
Inventory 596 1,055
Prepaid expenses and other current assets 8,701 7,000
Total current assets 276,023 267,071

Property and equipment:
Computer equipment 39,759 38,403
Office furniture and equipment 21,492 21,446
Leasehold improvements 21,155 21,183
82,406 81,032

Less accumulated depreciation 42,850 39,313
39,556 41,719

Restricted marketable securities 14,125 14,690
Goodwill, less accumulated amortization of
$27,381 200,857 200,464
Other intangible assets, less accumulated
amortization of $10,471 and $9,233,
respectively 14,136 15,384
Other assets 7,001 7,240
Total assets $551,698 $546,568

LIABILITIES AND STOCKHOLDERS` EQUITY
Current liabilities:
Accounts payable $3,836 $1,765
Accrued expenses 18,823 22,332
Deferred revenues 54,111 55,587
Total current liabilities 76,770 79,684

Other non-current liabilities 2,647 2,328

Stockholders` equity:
Preferred stock; $.001 par value; 20,000,000
shares authorized, none issued or outstanding --- ---
Common stock; $.001 par value; 120,000,000
shares authorized,
49,639,000 and 49,544,000 shares issued and
outstanding, respectively 50 50
Additional paid-in-capital 467,983 463,779
Deferred compensation (418) (702)
Accumulated other comprehensive income 600 949
Retained earnings 7,876 2,514
Less treasury stock, at cost (281,000 and
133,000 shares, respectively) (3,810) (2,034)

Total stockholders` equity 472,281 464,556

Total liabilities and stockholders` equity $551,698 $546,568



Business Outlook Reconciliation

This table does not reflect the potential impact of any mergers,
acquisitions or other business combinations that may be completed
after the date of this release.



Q2 2003 Range Annual 2003 Range
Low end Upper end Low end Upper end

Expected revenues $60,000,000 $64,000,000 $248,000,000 $248,000,000
Expected net income per
share $ 0.11 $ 0.13 $ 0.49 $ 0.57

Add back per share impact
of amortization of
intangibles and stock
based compensation $ 0.02 $ 0.02 $ 0.08 $ 0.08
Expected pro forma net
income per share $ 0.13 $ 0.15 $ 0.57 $ 0.65




--------------------------------------------------------------------------------
Source: Internet Security Systems, Inc.

[megatip]

Barron`s: Security sector opportunity
By CBS.MarketWatch.com
Last Update: 1:00 PM ET June 14, 2003







SAN FRANCISCO (CBS.MW) -- It`s not science fiction anymore to talk about eyeball scanners, and that technology advance has lifted prospects for homeland-security investments, noted in the latest Barron`s.

One research group has an index that helps keep tabs on the prospects for the products and services that became a focus after the Sept. 11 terror strikes.

Barron`s points to Laguna Research Partners` 11-company tool that follows Armor Holdings (AH: news, chart, profile), Check Point Software Technologies (CHKP: news, chart, profile), CompuDyne (CDCY: news, chart, profile), Identix (IDNX: news, chart, profile), Internet Security Systems (ISSX: news, chart, profile), InVision Technologies (INVN: news, chart, profile), L-3 Communications (LLL: news, chart, profile), OSI Systems (OSIS: news, chart, profile), Symantec (SYMC: news, chart, profile), Viisage Technology (VISG: news, chart, profile) and Zebra Technologies (ZBRA: news, chart, profile).

All have roles in protecting airlines, such as InVision`s airport explosives detectors, or keeping intruders out of buildings or computer systems.

Indicative of the maturing sector, says Barron`s, are the indexed stocks` 91 percent first-quarter profit gain year-over-year, as well as a 4.1 percent profit margin gain, to 17.2 percent.

Stock values have also risen, especially since the creation of the federal Homeland Security Department and the expectation of a steady stream of government revenue. Another driver is interest from big private equity investors, investment banker Jack Mallon of Mallon & Associates tells Barron`s.

Major defense contractors are also eyeing the sector for acquisitions, further fueling prospects for even higher stock gains, Barron`s says.

Among the other security firms mentioned in the article are Drexler Technology (DRXR: news, chart, profile), with a government contract on scannable ID cards, video security company Verint Systems (VRNT: news, chart, profile) and body-armor manufacturer Ceradyne (CRDN: news, chart, profile).

[panik]

Reuters
UPDATE - Internet Security Q2 profit rises, cuts outlook
Wednesday July 16, 4:55 pm ET


(Adds outlook, details)
SEATTLE, July 16 (Reuters) - Computer security company Internet Security Systems Inc. (NasdaqNM:ISSX - News; ISS) on Wednesday posted a higher quarterly profit even as revenue dipped slightly from a year earlier, but a lower outlook sent its shares down more than 14 percent in after-market trading.

ADVERTISEMENT


Atlanta-based ISS reported second-quarter net income of $4.9 million, or 10 cents per share, compared with a net profit of $4.1 million, or 8 cents per share, a year earlier.

Revenue fell 2 percent to $59.1 million from $60 million a year earlier.

"ISS continues to expect that the enterprise spending environment will remain difficult for the balance of 2003," the company said in a statement.

For the September quarter, ISS said it expects revenues to be between $58 million and $62 million, with earnings, excluding amortization and stock-based compensation or 11 to 14 cents per share.

ISS lowered its projected revenue for the year by about $10 million, and now expects revenue of $238 million to $248 million and earnings between 50 cents to 57 cents per diluted share.

Previously ISS had forecast full year earnings of 57 cents to 65 cents per share.

The lower outlook sparked a sell-off in ISS shares, where it was down 14 percent at $12.69 from the Nasdaq close of $14.78.









-----------------------------------------------------------




9:10AM ISSX seen settling in $10-12 range : Lehman expects ISSX shares to selloff this morning and settle in the $10-12 range following disappointing Q2 results. Firm lowers price target to $12 from $15.

[wutank]

Associated Press
Microsoft Admits Flaw in Windows Software
Thursday July 17, 7:49 am ET
By Ted Bridis, AP Technology Writer
Microsoft Admits Flaw in Nearly All Windows Software, Affects 2003 Software


WASHINGTON (AP) -- Microsoft Corp. acknowledged a critical vulnerability Wednesday in nearly all versions of its flagship Windows operating system software, the first such design flaw to affect its latest Windows Server 2003 software.
ADVERTISEMENT


Microsoft said the vulnerability could allow hackers to seize control of a victim`s Windows computer over the Internet, stealing data, deleting files or eavesdropping on e-mails. The company urged customers to immediately apply a free software repairing patch available from Microsoft`s Web site.

The disclosure was unusually embarrassing for Microsoft because it demonstrated the first such serious flaw in the company`s powerful new computer server software, billed as its safest ever.

The software is aimed at large corporate customers and was the first product sold under a high-profile "Trustworthy Computing" initiative organized last year by Microsoft founder Bill Gates.

At the product`s launch in late April, Microsoft Chief Executive Steve Ballmer declared the new version of Windows to be a "breakthrough in terms of what it means, in terms of its built-in security and reliability."

The flaw, discovered by researchers in western Poland, also affected Windows versions popular among home users.

"This is one of the worst Windows vulnerabilities ever," said Marc Maiffret, an executive at eEye Digital Security Inc. of Aliso Viejo, Calif., whose researchers discovered similarly dangerous flaws in at least three earlier versions of Windows.

Microsoft said corporate firewalls commonly block the type of data connections that hackers outside a company would need for these attacks. The flaw affects Windows technology used to share data files across computer networks.

Maiffret said that inside vulnerable corporations, "until they have this patch installed, it will be Swiss cheese -- anybody can walk in and out of their servers."

Microsoft spent hundreds of millions of dollars on security improvements for its latest Windows software and included new technology to defend against a category of hacker attacks known as "buffer overflows," which can trick software into accepting dangerous commands.

But four Polish researchers, known as the "Last Stage of Delirium Research Group," said they discovered how to bypass the additional protections Microsoft added, just three months after the software went on sale.

The head of Microsoft`s security response center, Kevin Kean, said improving Windows software is an ongoing process. "We continue to try to make it better and when we find a situation where techniques we`ve built into the system are not perfect, we go out and fix them," Kean said.

Microsoft also acknowledged a separate design flaw affecting only Windows XP, but it was deemed less serious because hackers would have to already have broken into a corporate network to attack victims. The company also released a patch for it.

Although the Polish researchers created a tool to demonstrate the more serious vulnerability and break into victim computers, they promised not to release blueprints for such software onto the Internet.

"We`re fully aware of the potential impact," group member Tomasz Ostwald said in a telephone interview. "We don`t plan to publish this code at the moment. It`s too dangerous."

Ostwald said the group, which other experts said was highly regarded in the security community, expected to disclose additional details during technical presentations at upcoming security seminars.

Some experts said they expected hackers to begin using this new vulnerability to break into computers within months. Even without detailed blueprints from researchers, hackers typically break apart the patches Microsoft provides for clues about how to exploit a new flaw.

"We could see it in a week or a year or not at all, but I expect we would see something in a three-month time frame," said Russ Cooper of Herndon, Va.,-based TruSecure Corp.

Internet Security Systems Inc. said the Windows flaw "poses an enormous threat" and raised its alert level to its second notch, reflecting "increased vigilance." The Atlanta-based company operates an early warning network for the technology industry, the Information Technology Information Sharing and Analysis Center.

The announcement came one day after the Department of Homeland Security announced that it awarded a five-year, $90-million contract for Microsoft to supply all its most important desktop and server software for about 140,000 computers inside the new federal agency.

Microsoft Security: www.microsoft.com/security

Polish researchers: http://lsd-pl.net/special.html

[wutank]

Dow Jones Business News
ISS Says Hackers Begin Attacking Cisco Routers
Friday July 18, 11:36 am ET
By Riva Richmond, Of DOW JONES NEWSWIRES


NEW YORK (Dow Jones)--Hackers have begun attacking Cisco Systems Inc. (NasdaqNM:CSCO - News) routers, just one day after the networking equipment giant said there was a serious security flaw in its routers` operating system.
ADVERTISEMENT


Intrusion-detection software maker Internet Security Systems Inc. (NasdaqNM:ISSX - News) said a program code of how to exploit the Cisco flaw was posted to an Internet mailing list popular with hackers, called "Full Disclosure," at about 3 a.m. EDT.

Within hours, ISS received reports from Internet service providers that their routers were being attacked and that they were seeing unusually large amounts of traffic using the relatively rare Internet protocols needed to exploit the flaw.

"We have received a lot of reports of routers being attacked and taken down," said Dan Ingevaldson, a researcher at ISS, which is predicting significant network outages will occur.

On Thursday, Cisco released a security advisory detailing the vulnerability, which affects its entire line of IPv4 devices, and urged customers to upgrade to a new version of the operating system. But upgrading operating systems is no small task. Later in the day, Cisco added a sentence to its advisory detailing which protocols could deliver an attack so customers could deploy filters to block them.

"We can assume hackers went to work," Ingevaldson said. The added bit of information "shown a spotlight on exactly what the issue was."

As Cisco spokesman said he hadn`t heard about any attacks and that the company doesn`t comment on rumors.

By Riva Richmond, Dow Jones Newswires; 201-938-5670; [e-mail]

[panik]

Ford Motor Company Selects Internet Security Systems For Managed Protection Services
Tuesday September 16, 7:45 am ET


ATLANTA, Sept. 16 /PRNewswire-FirstCall/ -- Internet Security Systems, Inc. (ISS) (Nasdaq: ISSX - News), today announced that it has been selected by Ford Motor Company to provide Managed Protection Services to manage, monitor and protect Ford Motor Company`s worldwide corporate information infrastructure.
ADVERTISEMENT


Ford Motor Company and ISS have developed a strong relationship over the past year. In October 2002, Ford selected ISS to deploy its complete platform of protection offerings throughout Ford`s worldwide corporate infrastructure (link to press announcement: http://www.iss.net/issEn/delivery/prdetail.jsp?type=&oid=213… This established relationship and sound confidence in ISS offerings was a key factor in selecting ISS as Ford`s provider of choice for Managed Protection Services.

"We are absolutely delighted to take another positive step forward in our relationship with Ford Motor Company," said Pete Privateer, senior vice president of worldwide marketing for ISS. "With the selection of our Managed Protection Services, complimented by our platform of unified protection offerings already deployed on Ford`s networking environment, ISS continues to provide Ford with complete worldwide protection a multinational organization demands."

ISS Managed Protection Services offers organizations guaranteed protection, enabling them to entrust the protection of their networking environment to a trusted security partner. The solution goes beyond simple event monitoring and device management by offering protection supported by guaranteed performance-based service level agreements. Utilizing Internet Security Systems` award-winning RealSecure® technology and Proventia(TM) appliances, ISS` specialized security operations experts are able to rapidly identify potential threats and respond appropriately to minimize risk to the customer.

ISS` Managed Services global infrastructure, which is composed of five security operations centers located on three continents, will be responsible for monitoring, managing and protecting Ford`s global enterprise. The security operation centers are backed by the unequivocal security intelligence of ISS` world-renowned X-Force(TM) security research and development team, providing the highest level of expertise and latest security knowledge in the industry.

About Internet Security Systems, Inc.

Internet Security Systems, Inc. is a world leader in products and services that protect critical information assets from an ever-changing spectrum of threats and misuse. Products from Internet Security Systems dynamically detect, prevent and respond to sophisticated threats to networks, servers and desktops. Services include 24/7 system monitoring, emergency response and access to the X-Force, Internet Security Systems` renowned research and development team. Internet Security Systems is the trusted security provider for more than 11,000 corporate customers, including all of the Fortune 50, the top 10 largest U.S. securities firms, 10 of the world`s largest telecommunications companies and major agencies and departments within U.S. local, state and federal governments. Headquartered in Atlanta, Internet Security Systems has additional operations throughout the Americas, Asia, Australia, Europe and the Middle East. For more information, visit the Internet Security Systems Web site at www.iss.net or call 888-901-7477.

Internet Security Systems, Proventia and X-Force are trademarks, and RealSecure a registered trademark, of Internet Security Systems, Inc. All other companies and products mentioned are trademarks and property of their respective owners.




--------------------------------------------------------------------------------
Source: Internet Security Systems