ICAO PKD Implementation

Financing Requirements

May 18, 2004

Status

ICAO PKI Infrastructure Specification achieved – new Technical Report

ICAO Public Key Directory (PKD) required – TAG approval implies action

Detailed estimates and budgets available Proposal for first phase in hand Some funds potentially available from ICAO

Elements of the PKD

Architecture – 2 sites, each with backup. Secure communications with countries Outsourced site/system IT operations. ICAO staff for PKD operation & management

– PKD certificate update– Due diligence review– Country support and liaison

One-time setup and annual subscription fees

PKD Operations - Assumptions

Year 0 (next 12 months) – implementation Year 0 - first site installed in Montreal Year 1 – 13 Visa Waiver nations sign up, plus USA and

Canada Year 1 – 2nd site installed remote from Montreal. ICAO staffing in Years 0 and 1 Other VW nations in Years 2 & 3 No schedule assumptions for non-VW nations

Budget Highlights

Full Implementation costs - $1.8M USD– Includes 2 sites & ICAO staffing

Annual operating costs - ~$800,000 USD– Includes outsourced IT management at 2 sites

Cash Flow Assumptions

Fees based on country size:

– Scale 1 countries: <15M citizens– Scale 2 countries: 15M to 25M citizens– Scale 3 countries: 25M to 100M citizens– Scale 4 countries: >100M citizens

Cost of money = 10%

Fee Assumptions

Initial setup fees:

– Scale 1 - $50,000– Scale 2 - $50,000– Scale 3 - $100,000– Scale 4 - $150,000

Participation fees:

– Scale 1 - $25,000– Scale 2 - $25,000– Scale 3 - $75,000– Scale 4 - $75,000

Spreadsheet Results

Maximum negative cash flow = $1.6M USD– Some hedge required

Break-even in ops Year 4 (5 years hence)

Small operating margins thereafter

Very economical operation for all countries

Financing Options

Grants?– Unlikely

Country loans– Only a few countries need participate

Commercial loans– Country guarantees?

Commercial financing– “Partnership” arrangements with industry

Conclusions

PKD can be and must be done

Inexpensive for all

ICAO is ready; must proceed NOW.

Immediate decisions necessary; specific country support requested.