By Tom Corrigan
21 July 2014
Dow Jones Institutional News
Copyright © 2014, Dow Jones & Company, Inc.
Four years after emerging from bankruptcy, CLEAR, a biometric-identification service that allows customers to zip through security screenings, is preparing to open fast lanes in new airports across the country.
According to CLEAR President and Chief Financial Officer Ken Cornick, the Manhattan company, whose screening services are available at nine U.S. airports, will enter McCarran International Airport in Las Vegas, a hub for many conferences and conventions. The new lanes could open as soon as next month.
The move is expected to add 30 employees to CLEAR’s 230-employee roster, and the company is in talks to make its services available in Miami International Airport and Baltimore Washington International Airport.
“We are close to finalizing an agreement with CLEAR,” Greg Chin, a spokesman for the Miami-Dade Aviation Department, said Monday afternoon. “We expect an agreement to be in place in the coming months.”
A representative of Baltimore Washington International Airport couldn’t immediately be reached.
CLEAR’s growth plans come more than four years after the company’s predecessor filed for bankruptcy protection in December 2009 to address more than $30 million in debt. At the time, it had outsourced almost all its functions, including the creation and maintenance of its biometric technology. The company also had contracts with a wide variety of airports, some in cities as small as Albany, N.Y.
Alclear LLC acquired CLEAR out of bankruptcy in 2010. Today, CLEAR develops its own technology, is profitable and expects net revenue of more than $20 million this year, sharing several million of that with its airport partners.
CLEAR’s service, which Chairman and Chief Executive Caryn Seidman-Becker refers to as the “ATM of identity,” uses biometrics such as a fingerprint or iris scan to confirm a person’s identity.
To enroll in CLEAR, a customer must visit a company center to supply his or her personal and biometric information, which are in turn used to create profiles that meet federal requirements and allow for expedited security screenings.
Using CLEAR’s blue-and-white kiosks and dedicated lanes at airport security checkpoints, members skip the lines that for many passengers, all too familiar with the discomforts of flying, often add insult to injury.
“It’s basically a nonstop walk straight through security to the metal detector,” said Randy Ramcharan, a CLEAR member. “I think the longest I’ve ever waited is behind two people.”
Mr. Ramcharan, a 29-year-old consultant from San Antonio, said he took 85 to 90 round-trip flights last year and expects to exceed that number this year.
The service costs $179 per year for unlimited use. A family member can be added for $50, and children under 18 can tag along free.
Because not every airport is a CLEAR partner, the service isn’t yet practical for some frequent fliers. Members say they had to consider the number of trips they will take through airports with CLEAR.
“In order to justify the expense, you have to have a significant number of flights through their enabled airports,” said Rick Drushal, a 30-year-old data consultant from San Jose, which, along with San Francisco, is a CLEAR-enabled airport.
CLEAR isn’t the only program designed to help travelers zip through the airport screening process. The Transportation Security Administration’s Precheck program, launched in 2011, allows approved members to keep on their shoes and light jackets, while liquids and laptops can stay tucked away inside bags.
But CLEAR isn’t a Precheck rival. In fact, many CLEAR members are also Precheck enrollees. “We love Precheck,” said Ms. Seidman-Becker, who said the TSA’s program is “highly complementary” with CLEAR.
While CLEAR focuses on getting members to an airport’s metal detectors quickly and efficiently, Precheck offers what is essentially pre-9/11 screening to trusted travelers who, like CLEAR members, have their backgrounds examined and are checked against law-enforcement databases.
Mark J. Sullivan, the former head of the U.S. Secret Service and now a partner at security consulting firm Global Security & Intelligence Strategies, said CLEAR can be a valuable risk-management tool for airports. “I look at this as one more method of mitigating threat,” said Mr. Sullivan, who doesn’t have any ties to the company. “The fact that they’re using biometrics and data analytics, I think is just a really forward-leaning way of looking at risks.”
Mr. Sullivan and his partner Paul Benda, the former head of research and development for the Department of Homeland Security, also said the company’s technology could be tailored to augment security screenings at stadiums or to improve many businesses’ background-check systems.
Though CLEAR’s predecessor shut down prior to filing for bankruptcy, it honored the remaining subscription terms for its nearly 160,000 former members when it was relaunched. About 75% of those former customers renewed their memberships, according to Ms. Seidman-Becker.
“They did a very commendable job in contacting all those folks,” said James Rose, the Deputy Executive Director of the Greater Orlando Aviation Authority, the operator of the Orlando International Airport, which offers CLEAR screening.
Mr. Rose says the company is looking for additional ways to enhance its service, including collaborating with one of the airport’s food-concession businesses to offer breakfast to members on their way through security.
For everyone else stuck in the slow lane, watching CLEAR members cut to the front of the line undoubtedly provokes at least a little jealousy. But Ms. Seidman-Becker doesn’t see it that way. “It’s no more skipping the line than going to the ATM instead of a bank teller,” she said.
(Dow Jones Daily Bankruptcy Review covers news about distressed companies and those under bankruptcy protection. Go to http://dbr.dowjones.com)
Write to Tom Corrigan at email@example.com.
July 21, 2014 17:23 ET (21:23 GMT)