Watermark Magnetics® Card Technology

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As the use of magnetic stripe cards increases, so does the incidence of fraud. Worldwide losses from fraudulent activity on bank cards alone reached an annual total of $1.2 billion in 1993 and are expected to exceed $2.5 billion by the end of the century.

Standard magnetic stripe technology is highly vulnerable to the risks of counterfeiting, copying and card substitution. To counter this threat, THORN EMI developed Watermark Magnetics : a unique technology which allows all card applications to be made considerably more secure.

Today, Watermark Magnetics is supplied exclusively by TSSI, through its distributors, to customers throughout the world. Security Magnetics Pty Ltd is TSSI's licensed distributor in Australia and New Zealand.

Together, TSSI and Security Magnetics are committed to meeting the growing demand for enhanced security in all types of magnetic stripe applications, protecting the interests of card issuers and users against the rising tide of crime.

So, what is Watermark Magnetics?

The manufacturing process for Watermark Magnetics tape is similar to that used for standard magnetics. A controlled thickness of magnetic oxide slurry is coated onto a suitable non-magnetic substrate. While still wet, the slurry is passed over a permanent magnet to align all the oxide particles. Thus far the manufacturing process is the same as for standard magnetic media.

Once the particles have been aligned, the wet slurry passes over an electromagnetic encoding head which is at 90 degrees to the permanent magnet.

When switched on the magnetic oxide particles are rotated through 90 degrees; when switched off, they remain in their original orientation.

    Show me a picture of Watermark Tape
    Show me encoding on Watermark Cards

Proprietary electronics control the switching of the electromagnet to encode information in a unique pattern, with a binary format using the Aitken F2F approach. The control electronics (Watermark Word Generator) can change the encoded pattern for every 'card length' of tape to produce a series of unique numbers.

After the Watermark pattern is formed, the tape passes through an oven which cures the resins and drives the orientation of the particles. The pattern is now fixed and cannot be erased or altered without physically destroying the magnetics medium.

In addition, standard soft magnetic data can be encoded over the Watermark pattern. Encoding and reading standard data relies on creating and detecting polarity reversals. Watermark encoding is different as it relies on the changes in particle orientation and the detection of the transitions between adjacent blocks of different orientation. Although the particles in Watermark tape are aligned in different directions, they can still be polarised by standard magnetic stripe encoding principles.

    Show me Encoding Track 2 on Watermark Cards
    What is Aitken F2F encoding?

The Watermark pattern encoded into the magnetic medium is secure against erasure and modification. However, it is also important that the reading technology should be able to discriminate between genuine Watermark and fraudulent attempts at duplication.

To provide this security, a unique active reading technology has been developed. Instead of the reader passively detecting the magnetic field due to the polarisation of the tape, the Watermark head is actively driven by the reading circuitry. An alternating magnetic field is produced across the head gap which penetrates into the tape. As regions of different particle orientation pass the head, they interact with the alternating magnetic field.

This interaction is detected and measured by the reading circuitry which confirms that the tape is genuine and identifies the transitions in the pattern.

Normal F2F decoding of the transitions follows and the data bits are fed out. The active read technology erases any standard polarity encoding in its path, thereby removing the threat posed by fraudulent attempts to mimic Watermark.

As a result the Watermark data is read in a separate location to the standard encoding. For ISO standard cards this is in the track 0 position, which lies between the ISO track 1 location and the edge of the card.

    Show me a picture of reading Watermark Cards

The benefits of the security offered by Watermark Magnetics have been exploited in a wide variety of applications. These include:

  • Access control to the buildings and systems, where the owner wants to be assured that only the correct card is being used.
  • Identity card systems, where the permanent and unique Watermark number serves to identify an individual.
  • Stored value applications where the value is stored on the card in standard magnetic encoding, but protected against fraudulent copying by being linked to the permanent Watermark encoding.
  • Bank card applications where the bank wishes to be certain that the card presented is the one issued rather than a fraudulently manufactured and encoded copy.

Go To:
    Standard Magnetics
    Contactless Cards
    Memory Cards
    Smart Cards
    Watermark Card Readers
    Watermark Applications and Systems

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