Screenplay

While the overall downturn of the financial markets has presented significant challenges for the technology sector, Net Nanny Software International is expecting to reach profitability in the upcoming fourth quarter.

The Bellevue-based company reports that revenues for the second quarter 2001, which ended December 30, 2000 hit a record high of $829,000, 1000% higher than last quarter, and an increase of $648,145 or 460% over the same period last year.

Net Nanny credits the increase in sales in fiscal 2001 to the shipment of the its new Net Nanny 4 product into large mainstream retailers and online resellers, as well as the inclusion of revenue generated from pre-sales of the product during the previous quarter.

Another product that is helping push the company forward is its BioPassword LogOn for Windows NT. A product that authenticates users on a network. BioPassword, which was recently released on a commercial basis, is the first product to use the Net Nanny's patented biometric authentication technology.

BioPassword seems to be finding an audience amongst companies and artists seeking to protect their intellectual property, especially as music download controversies are still in high volume.

One of the companies that is already integrating the BioPassword technology into its digital rights management system for secure music downloads is Musicrypt. Net Nanny owns one million shares, or approximately 18%, of the common shares in the Toronto-based company.