a dutch auction is a type of auction in which the auctioneer begins with a high asking price which is lowered until some participant is willing to accept the auctioneer 's price , or a predetermined reserve price ( the seller 's minimum acceptable price ) is reached .

the winning participant pays the last announced price .

this is also known as a clock auction or an open-outcry descending-price auction .

this type of auction is convenient when it is important to auction goods quickly , since a sale never requires more than one bid .

the dutch auction guarantees that the best possible price is obtained , in contrast to a traditional auction where the winning bidder may have been prepared to bid considerably more .

dutch auction

using a dutch auction . to participate in a dutch auction , an investor typically
a dutch auction is also known as a descending price auction or uniform price auction . google used a dutch auction to price its share when it went public in 2004 .
in future posts , i ' ll discuss how to get around these limitations on a simple dutch auction , and introduce you to other variations on the dutch auction , including the popular and powerful second - item auction ( also known as a dutch auction ipo or google ipo auction ) , a supply / demand auction ( where bidders and suppliers enter bids ) , and finally i will introduce you to optimal auctions ' unique and powerful dutch auction solution , our own advanced dutch auction , which solves all the limitations in the dutch auction varieties that are common today .
the dutch auction also provides an alternative bidding process to ipo pricing . when google launched its public offering , it relied on a dutch auction to earn a fair price .
the hottest tech ipo in years will be run as a
dutch auction .
the goal of a dutch auction is the find the optimal price at which to sell a security .
the dutch direct auction ( dda ) is a transparent and rule - based auction technique designed by the dsta for the auctioning of government debt securities .
an absolute auction is a type of auction where the sale is awarded . . .
a reverse auction is a type of auction in which sellers bid for . . .
brandenberg , denise .
how does a dutch auction work ?
pocket sense , urltoken 19 april 2017 .
brandenberg , denise .
how does a dutch auction work ?
last modified april 19 , 2017 . urltoken
dutch auction is a method of public offering in which the price of the shares are lowered until there are enough bids to sell all shares . the price of the offering is then lowered to this lowest bid . dutch auction happens online .
a dutch auction differs from a regular auction in that it opens with a high asking price , instead of a low one . many nations’ treasury departments , including the u . s . treasury , use dutch auctions to sell securities . dutch auctions are also popular alternative bidding processes to initial public offerings , or ipos .
brandenberg , denise . ( 2017 , april 19 ) . how does a dutch auction work ? pocket sense . retrieved from urltoken
dutch auction sales • 356 swedesboro avenue • 856 . 423 . 6800 • fax 856 . 423 . 7857 • dutchauctionsales @ urltoken
forbes : ipo dutch auctions vs . traditional allocation ; ari weinberg ; may 2004
how does the u . s . government use dutch auctions to raise money ?
optimal shareholder bidding strategies in a dutch auction share repurchase are derived when shareholder heterogeneity could be due to either differential expectations regarding the firm ' s future earnings or differential tax bases . predictions of the theory are tested by analysing the actual tender premiums paid by firms completing dutch auction share repurchases .
why use a dutch negotiation instead of reverse auction ? the biggest reasons for running a dutch auction are because of weak competition , tight timelines , or a need for greater control . dutch is ideal when there aren’t many suppliers bidding for the good or service or there is a large preliminary bid price gap between 1 st and 2 nd place . event timelines operate with greater predictability as events can be complete in 25 minutes in a worst case scenario , for these reasons noted dutch auctions have become a personal preference . this preference towards dutch auction is also based on the savings results that compare well to reverse auctions . ideally sourcing organizations should use the dutch event type frequently to avoid developing a predictable reputation with the supply base ( suppliers will learn a company’s tendencies to use dutch only when competition is weak ) .
the term
dutch auction
may sound all greek and latin to many investors , although they get to see the word thrown around in press releases of companies . what does a dutch auction mean ? why do companies prefer it over the traditional offering ? benzinga set out to explore answers for these questions .
google is going to use a variation on what is known as a dutch auction , called that because it was created in the early flower markets of the netherlands to sell multiple identical items . in the classic dutch auction , a seller indicates how many items are available for sale and sets the minimum bid price .
, and obtains an access code or bidder identification code ( dutch auctions often occur online ) .
the u . s . treasury uses the dutch auction method to sell treasury securities , and many u . s . companies use the method for share buybacks .
why don ' t more companies use the dutch - auction method when they go public ? it would have made a huge difference for the likes of linkedin .
some of the best auction graphs will only have a single dot ; this solitary bid on the graph demonstrates a previously unknown opportunity in a flawlessly executed dutch negotiation . this article may be a point of review for many readers as reverse dutch auction functionality is a common feature on almost all esourcing software ; however among all the sourcing consulting professionals i’ve met over the last few years i have not met another who has leveraged dutch negotiations .
after conducting several valuation calculations and talking to potential investors . but a dutch auction is theoretically more efficient at finding the
right
price that equates supply and demand .
it worked for google , so would a dutch auction process work for your ipo ? here are some things to consider before following in the search engine ' s footsteps .
why don ' t more companies use the dutch - auction method when they go public ? it would have made a huge difference for the likes of linkedin . - quora
a dutch auction opens at the highest price and drops gradually until there ' s a buyer willing to pay the amount being asked . the transaction is completed at that price .
optimal shareholder bidding strategies in a dutch auction share repurchase are derived when shareholder heterogeneity could be due to either differential expectations regarding the firm ' s future earnings or differential tax bases . predictions of the theory are tested by analyzing the actual tender premiums paid by firms completing dutch auction share repurchases . copyright 1996 by the london school of economics and political science .
but aside from a funny name , what is a dutch auction ipo ? well , to understand it , let’s first take a look at the traditional approach to pricing an offering .
editor ' s note : google ' s decision to launch its 2004 ipo via a so - called dutch auction process has caused a pause in many companies considering their own ipos . after all , shares of the internet search engine provider soared and remain high today . but is google a special case ? would some ipos fare better than others in a dutch auction ?
in a dutch auction , the price of an item is typically set at a very high price – higher than what most customers will pay – and the auctioneer lowers the price until someone bids on the item . when the event is a dutch auction ipo , prospective investors bid on both the price and quantity of shares . the purpose of this type of auction is to sell all shares at once , even if it’s to different bidders .
what do you really know about a dutch auction ? the history and origin of the dutch auction is actually a fascinating look at many of the same economic themes and issues we look at today . microeconomic themes like supply and demand , finance themes like futures and options , and auction theory themes like first price and efficient pricing all were explored in 1600 ' s holland , hundreds of years before they were considered the science they are today .
a dutch auction is a public offering auction structure in which the price of the offering is set after taking in all bids to determine the highest price at which the total offering can be sold . in this type of auction , investors place a bid for the amount they are willing to buy in terms of quantity and price .
to wrap everything up , this type of auction format which originated in the crazy times of the dutch tulip craze took the name of the people who popularlized it and made it prevalent .
however , there’s usually no pop on the first day of trading after a dutch auction . after all , the valuation of the offering tends to be in line with the market value .
it only works when 1 product is being sold ( if we wanted to sell 2 gold sls amg ' s at the same time , this simple dutch auction format could not be used . )
* with the dutch auction and any other auction type they are most successful when the process has been transparent to the suppliers , true awarding of business is based on auction results , all factors are included in each suppliers proposal , and that the auction is the final step of the evaluation process ( lab testing , contract signing , insurance requirements , payment terms , etc have all been buttoned down with each of the processes’ remaining suppliers ) .
the solution , of course , was a dutch auction . a true dutch auction has the following attributes : it starts at an artificially high price , where demand is known ( or believed ) to be 0 . at publicly known time intervals , the price ticks down in publicly known price increments . the price continues to tick down until the first bid is received . at this point , the auction ends immediately , and the bidder wins the product at the price when he placed his bid .
google ' s $ 2 . 7 billion initial public offering , to be priced through an electronic auction , will test the large - scale viability of a so - called dutch auction , designed to both democratize ipo share allocation and afford companies and early investors the best price for their shares .
the process for a dutch auction is somewhat similar . the underwriters will help with the documentation preparation , prepare a valuation and go on the roadshow . however , the pricing of the deal is a much different process .
dutch auction is one of the largest antique & used furniture auctions in the country . we are a wholesale auction that specializes in supplying auctions , dealers , galleries and private buyers with antiques , collectibles , and other estate merchandise . sales are held every other saturday all year round . there are 25 sales per year .
a sealed - bid auction is a process in which none of the bidders . . .
the only securities auctions in us markets that are conducted as dutch auctions are the competitive bids for us treasury bills , notes , and bonds .
some companies , such as morningstar ( nasdaq : morn ) and google ( nasdaq : goog ) , have opted for a so - called dutch auction when pulling off their initial public offerings . there’s even buzz that facebook might try it .
the auction ends immediately . bidder a has just won the car at $ 4 . 4m .
resources connection , inc . ( nasdaq : recn ) recently announced preliminary results of its modified
dutch auction
tender offer to buy up to 6 million shares at a price not greater than $ 16 nor less than $ 13 . 50 .
a dutch auction also refers to a type of auction in which the price on an item is lowered until it gets a bid . the first bid made is the winning bid and results in a sale , assuming that the price is above the reserve price . this is in contrast to typical options , where the price rises as bidders compete .
it is known as a descending auction because the bids decrease over the course of the auction . unlike in english auctions , there is never a larger number of bids than there are items being auctioned . thus dutch auctions tend to end in a fairly short amount of time and are often associated with perishable goods such as flowers and produce . indeed , the greatest advantage of dutch auctions is probably their relative speed , which is useful for sellers who want to sell their goods as quickly as possible .
the concept is simple and most i’d spoken to about the subject know and understand the dutch negotiation setup and can recite that the auction opens with a price the buyer is looking for a seller to accept , the buyer’s offer continues to rise in value until the first seller accepts which will conclude the negotiation , thus one dot on the auction graph .
google ' s shares would be sold in a modified dutch auction because it has reserved the right to set the final sale price , the allocation of shares and other auction terms . it said in its public offering statement that its goal was to eliminate the first day ' ' pop ' ' in prices that was built into most initial stock offerings .
an auction of a new issue of securities where the highest price offered to buy a portion of the issue becomes the price at which the entire issue is sold . dutch auctions are particularly important because they are the means used to sell new issues of u . s . treasury securities . a dutch auction begins with the securities offered at a high price and the price is gradually lowered until there is a bid . this contrasts with a commercial option that begins at a low price that is gradually raised .
be sold . here , the underwriter wound up with bids for 13 million shares , but the highest bids adding up to 10 million shares are the winning bids in a dutch auction . the underwriter will then set the price equal to the lowest winning price bid on those 10 million shares ( in this case , $ 34 ) , and all the winning bidders will pay that price . ( dutch auctions are largely handled by computer , and the bids are not compared until the auction time has expired . )
here are some things for an issuing company to consider to ensure efficient pricing of its auction ipo .
although this auction method is more typical for pricing stock during an ipo , it can demonstrate to a private business owner that there are many different ways to conduct an auction . entrepreneurs looking to engage an investment banker to sell their businesses should test their knowledge of different auction types available to garner the highest price .
the dutch auction usually begins with a company revealing the amount of shares for sale , as well as a potential price for the shares . at the auction , which normally occurs online , the auctioneer calls out the first , high bid . when there are no responses , the price is lowered continually until the first person places a bid . that person is the winner of the bidding .
keep in mind that the dutch auction ipo system is based on some complicated algorithms , which are based on the work of nobel laureate william vickrey , whose approach also is used for the sale of treasuries . investment bank wr hambrecht owns the patent on the process , which is called openipo .
a dutch auction often starts at a very high initial price and then has to be dropped considerably , before it reaches a level where the cumulative quantity accepted by bidders covers the entire quantity offered for sale . the descending price nature allows a large number of individual bidders to buy small quantities of stock at a price determined by the auction process . some companies use this method to buy back shares from the shareholders .
unlike the traditional ipo offering , a dutch auction is a more efficient method to find the price based on demand and supply . some believe retail investors get the best chance to participate in the offering , as in a traditional offering , investment bankers tend to channelize the offering to their best clients .
quick aside , this $ 4 . 4m is not the same economic results from an ebay auction . while ebay auctions might seem simple , they aren ' t the most economically advantageous for the seller . an ebay auction is a second - price auction , while a dutch auction is a first - price equivalent . assume in the above auction that bidder b would have paid $ 4 . 1m for the car . in an ebay auction , bidder a , who would have paid $ 4 . 4m , will now only pay $ 4 . 2m ( second price + 1 increment ) . this is good news for bidder a , who saves $ 200k , but bad news for the seller , who gets less money on their sale . remember , since the seller is the one who almost always designs auctions , they should choose the format that ' s most advantageous economically for themselves .
theorize that buyers pay more for stock sold in dutch auctions because under the traditional method investment banks typically underprice offerings to make sure all the shares sell . also , they say shareholders benefit when shares are sold using traditional methods because the initial spike often associated with traditional ipos creates an image of success that drives the stock even higher . this is one reason shares sold in a dutch auction don ' t usually have the same run - up in price immediately after they begin trading .
the bidding price at a dutch auction decreases throughout the process , the opposite of traditional auctions . traditional auctions , sometimes referred to as english auctions , begin with a set low price . the auctioneer slowly raises the price until bidders stop placing bids . the last bid - upon price is the winning bid .
there is also a reverse dutch auction in which a single buyer invites bids , beginning at a very low level and then raises the bid price so as to attract a number of sellers . the price is raised to a level where sellers , cumulatively , are able to offer the required or planned quantity .
unlike the traditional method , in which only the institutional and sophisticated investors are involved , the dutch auction method enables small investors to participate in the pricing by posting the price that they are willing to pay and the number of shares that they wish to purchase . the final price of the ipo in a dutch auction is the lowest price at which all of the shares are sold . the role of the investment bank as the middleman is minimized . proponents of the online process argue that the value of the ipo goes to the company which is going public , rather than to the favored clients of the investment bank .
dutch auction sales first opened their doors on labor day , september , 1985 . since then , we have had over 480 auctions and have sold over 3 million lots of fine antiques , furniture , art , fine china , collectibles , sterling , bric a brac , mid century modern , and general estate items .
a dutch auction is a price discovery process during which the auctioneer starts with a high asking price and then lowers it in stages until the cumulative bids received cover the entire offer quantity . this type of auction is used for ipos to discover the optimum price for the full quantity of stock issued by a company . in this process , it is possible to sell the intended quantity at a competitive price , which is discovered by the forces of supply and demand . this auction is also used by government agencies for the public offer of treasury bills , notes and bonds .
let ' s take a modern example and run it through a dutch auction . the seller is trying to sell a limited edition gold plated mercedes sls amg . very expensive item , but the exact price , and exact demand , for the item is unsure . a perfect candidate for an auction . the seller publicly states that the opening price will be $ 5 , 000 , 000 and will tick down by $ 100 , 000 every 5 minutes .
' ' an auction is the fairest and most transparent system and will get the best price for the issuer , ' ' said paul klemperer , an economics professor at oxford and author of a forthcoming book , ' ' auction theory and practice . ' '
google ' s controversial ipo last year generated much interest not only because of its global name recognition , but also because of its use of the dutch auction method in pricing and selling its offering . while the ipo was seen by some as a successthe company ' s shares today are selling near $ 200a closer examination of the results raises questions about the benefits of the auction process to issuing companies . what can companies considering ipos learn from the google experience ?
the dda was first used in june 2003 for the primary issuance of a 5 - year bond . the goal of the dda is twofold , firstly to engage a broad investor base and secondly to auction government debt at the best price possible . investors can participate directly in the dda of the new dutch government bond through one ( or more ) primary dealer ( s ) . the dda is one of three auction techniques used by the dsta . it is used for the primary issuance of longer dated bonds ( 5 - , 10 - , and 30 - years ) . for the primary issuance of the 3 - year bonds the regular tap auction is used . the tap auction is also used to reopen bonds after they have been issued .
if a company is using a dutch auction initial public offering ( ipo ) , potential investors enter their bids for the number of shares they want to purchase as well as the price they are willing to pay . for example , an investor may place a bid for 100 shares at $ 100 while another investor offers $ 95 for 500 shares .
an auction in which the seller reduces the offering price until a level can be found that clears the market . this is the price at which all sales will take place . the auction for treasury bills is similar to this except that the treasury accepts the highest bids first and works through progressively lower bids until an issue is completely sold . thus , in a treasury bill auction , various prices are accepted .
here ' s a look into the online auction market and how to get yourself the best value possible on sites like ebay and quibids .
instead , google plans an auction of its shares to raise up to $ 2 . 7 billion ; a process open to all bidders .
the u . s . treasury uses a dutch auction to sell its securities . to help finance the country ' s debt , the us treasury holds regular auctions to sell treasury bills ( t - bills ) , notes ( t - notes ) , and bonds ( t - bonds ) , collectively known as treasuries . prospective investors submit bids electronically through treasurydirect or the treasury automated auction processing system ( taaps ) which accepts bids up to 30 days in advance of the auction . suppose the treasury seeks to raise $ 9 million in two - year notes with a 5 % coupon . let ' s assume the submitted bids are as follows :
one of the supposed benefits of the dutch auction process , which google used in its recent ipo , is its alleged minimization of the increase between the offer price and the opening price of the offering . from the perspective of the issuing company , this price increase represents
money left on the table
and , therefore , value which it did not appropriate .
in this type of auction the sale of the item begins a very high asking price . this price is progressively lowered at specific intervals in decrements . this continues until either a bidder is willing to accept the auctioneer’s current price , or the reserve price is met and the auction closes .
companies considering using the online auction process for an ipo should be interested in which parties are likely to benefit from mispricing , should it occur .
so why do it ? the dutch auction tends to favor the companies going public because it usually raises more money . at the same time , it can be more democratic — individual investors often have more participation because of the online system . and companies like google — and facebook — have a huge amount of users who might want to get their hands on some shares .
google will not comment on anything concerning its planned public offering , including its auction . but it deals with many of the concerns in its prospectus .
at a dutch auction , prices start high and are dropped successively until a bidder accepts the going price . once a price is accepted , the auction ends . for example , the auctioneer starts at $ 2 , 000 for an object . the bidders watch the price decline until it reaches a price that one of the bidders accepts . no bidder sees the others’ bids until after his or her own bid is formulated , and the winning bidder is the one with the highest bid . so , if there are no bidders at $ 2 , 000 , the price is lowered by $ 100 to $ 1 , 900 . if a bidder accepts the item of interest at , say the $ 1 , 500 mark , the auction ends .
and there was another reason . google ' s highly profitable business model was based on algorithmically auctioning advertising space alongside search results . so why not choose a different kind of auction to create a shareholder base ? in their letter to prospective investors , the same one that famously declared google ' s principal of
don ' t be evil ,
the co - founders wrote that
our experience with auction - based advertising systems has been helpful in the auction design process for the ipo .
after receiving the prospectus and sometime before the auction , bidders must obtain a
unique bidder id .
bidder ids will not be available after the bidding begins .
in the investment world , using a dutch auction for ipo allocation can benefit young companies , as it can allow the business to raise the most amount of cash available in the market . shareholders of companies that are in high demand can make high profits very quickly . it also benefits investors who get a jump on their competitors and bid first , but are then given the opportunity to take advantage of lower share pricing .
and for this reason , hambrecht ' s openipo process is not entirely unguided . companies still embark on a banker - led road show for major institutional investors , but the bidding and price discovery is automated . a representative for hambrecht would not comment on whether the company or its auction - technology will be used for google ' s auction .
this type of auction should cut down on the huge run - up in share price experienced during the first days of trading experienced by other tech ipos during the 1990s .
the performance of google in august 2004 , however , does not suggest that the online auction process served as an efficient pricing mechanism since the increase between google ' s offer price and its open price was much greater than the increase for typical ipos in 2004 . this should raise significant concerns for companies considering using the auction process for their ipo .
this other route is known as a modified dutch auction tender offer ( mdato ) . mdatos provide companies a great avenue to repurchase a predetermined value of shares within a set price range in a relatively short amount of time ( typically a month or two ) . mdatos also provide shareholders a way to liquidate their shares by tendering their shares at a price they believe the shares are worth . if a mdato is oversubscribed , shares will be subject to proration .
in the united states , the experience of auction offerings through hambrecht have been quite variable . in 1999 , the auction price of urltoken was $ 18 a share , but it shot to $ 67 . 50 three days later . the next year , shares of nogatech were auctioned at $ 12 , but three days later it closed at $ 7 . 44 .
dutch auction if a company is using a dutch auction ipo , potential investors enter their bids for the number of shares they want to purchase as well as the price they are willing to pay . for example , an investor may place a bid for 100 shares at $ 100 while another investor offers $ 95 for 500 shares . once all the bids are submitted , the allotted placement is assigned to the bidders from the highest bids down , until all of the allotted shares are assigned . however , the price that each bidder pays is based on the lowest price of all the allotted bidders , or essentially the last successful bid . therefore , even if you bid $ 100 for your 1 , 000 shares , if the last successful bid is $ 80 , you will only have to pay $ 80 for your 1 , 000 shares . when google launched its public offering , it relied on a dutch auction to earn a fair price . greenshoe option a provision contained in an underwriting agreement that gives the underwriter the right to sell investors more shares than originally planned by the issuer . this would normally be done if the demand for a security issue proves higher than expected . legally referred to as an over - allotment option . a greenshoe option can provide additional price stability to a security issue because the underwriter has the ability to increase supply and smooth out price fluctuations if demand surges .
an auction in which the asking price is lowered gradually until someone is willing to pay at that level , and the property is then sold to that person . contrast with the typical auction practice in which the auctioneer asks a high price , lowers it until someone places a bid , and then the auctioneer attempts to obtain higher bids to increase the price from there .
often called a
dutch
auction , this type of sale allows any investor—institution or individual—to put in a bid over the web for a certain number of shares at a certain price without knowing what others are offering to pay . after the bidding , the highest price at which every available share can be sold becomes the price for all the shares—the ipo price . google , along with early backers , was selling almost 20 million shares , and bids could be submitted for as few as five .
during bidding , investors indicate how many shares they ' re willing to buy and the price they ' re willing to pay . the underwriter , who acts as the auctioneer , usually starts the auction by
a double - action auction - - the system in place on us stock exchanges - - features many buyers and sellers bidding against each other to close a sale at a mutually agreed - upon price .
however , some also feel that dutch auctions may not offer the least possible price , as pricing of a traditional offering is priced low to ensure sale of all shares . when these shares begin trading , they pop up due to the fundamental appeal of the company and thus a run up in the share price is seen .
but the reason you don’t often hear about dutch auctions is because they’re fairly rare . major wall street banks like goldman sachs ( nyse : gs ) and morgan stanley ( nyse : ms ) want to keep control of the process . and by achieving first - day pops , they can build loyalty with their institutional investors .
back to the dutch auction . now that you know the background of the tulip market , you can picture the crazy scene at the exchange : traders milling around talking loudly , the noise , the hubbub , the contracts flying around . total commotion , very noisy , and very hard to keep everything organized . the exchange figured , correctly , that the best solution to selling the bulbs was to do it quickly , to do it with as few bids as possible , while at the same time getting as high a price as possible .
this method of ipo allocation can create an instant windfall for insiders by encapsulating as much market demand into the offering price as possible . and for young and growing companies , an auction allows the company to raise as much cash as the market is willing to afford it . but if the initial market demand is not there , a company putting its faith in the auction could miss out on the support of a traditional offering .
the final ipo price will be determined after the auction closes . the underwriters will calculate it by gathering all the bids and calculating the cut off point at or above which all the shares available can be sold .
4 .
auction ipos : first google , now morningstar ,
the wall street journal , january 11 , 2005 ;
morningstar ' s bright future turns cloudy ,
fortune , january 10 , 2005 .
in contrast , a conventional commercial auction begins with the lowest price , which gradually increases as potential buyers bid against each other . the selling price is determined when no bidder will top the last offer on the table .
patrick m . byrne , the chairman of overstock . com , an internet retailer , chose to take his company public by using an auction because he was disgusted with the way shares in initial offerings are typically allocated .
what are some possible explanations for the mispricing of the auction process ? one explanation is that the small investor , who is supposed to be a primary participant in this auction , may lack access to sufficiently detailed information sources to appropriately price the security based on fundamentals , rather than on name recognition . this potential problem is compounded by the lack of information that the online process ( in contrast to the traditional ipo process ) requires to be disclosed .
google ' s version of a dutch auction would eliminate a primary incentive for placing high bids . normally , buyers who bid above the actual clearing price are allowed to buy all the shares they ask for and those that bid exactly at the sale price divide the remaining shares , usually receiving fewer than they wanted . google , by contrast , proposes two methods to allocate shares that would not reward buyers for high bids . ( one method would give bidders a set percentage of their orders . the other would impose a maximum number of shares any bidder could buy . )
to the idealistic computer scientists who run google inc . , the company ' s unusual plan to auction shares in its public offering is both more efficient and fairer than the traditional method in which investment banks set the offering price .
ideally , the auction process enables sellers to price the issue
right .
that is , its price should reflect the reasoning of thousands of investors who will determine for themselves how much they are willing to pay for a share .
please see the attached graphs , graph # 1 is a perfectly executed reverse auction where there is a lot of rank change happening between multiple suppliers ; when rank is the motivator for bidding you want the ranks of the suppliers to change a lot to keep them bidding the prices down . the best way to help predict whether a reverse auction will be competitive w / multiple bids is to review the preliminary bids submitted in the rfp to determine whether each suppliers’ weighted tco bids are within 3 % - 6 % of each others . …the bigger the price gap between suppliers the bigger the chance is that suppliers’ ranks won’t change in a reverse auction . when suppliers’ ranks don’t change the suppliers get discouraged that their bids don’t result in a better ranking . this tight competition is needed to succeed or your 1 st place supplier has a chance of winning an auction w / o having to place a bid , which would be the worst possible outcome .
the benefits to the exchange are obvious - only 1 bid needs to be placed , so by making the starting price relatively close to the predicted sales price and making the time intervals small , auctions can be completed extremely rapidly . the auction has economic benefits to the seller as well - in theory it results in a price equivalent to a sealed - bid auction ( where each bidder submits bids in an envelope , and the high bidder wins at the price they bid ) .
buyer , who has been helping companies in the ipo process for seven years at class v group , said the topic of an auction almost never comes up . for the few executives who have discussed it , the idea has been dismissed pretty quickly by board members and advisers , she said . at google , she was working with a team that openly shunned wall street and had the brand recognition and consumer appeal to go against convention . even then , it wasn ' t a pure auction .
finally , during the height of the panic , the dutch parliament passed a law in an effort to curb the panic that stated that all futures contracts could be canceled at any point if the buyer paid the seller 3 . 5 % of the contract price . a contract that can be canceled at any point with only a fixed price paid to the seller for the right to cancel - sounds an awful lot like an option to me ! yes , even the primitive option market was created during the dutch tulip panic . as modern finance could predict however , with only a small penalty for misguided speculative bets , these new option contracts exacerbated the problem by allowing traders to increase their bets through massive leverage . sometimes creating new financial instruments can lead to unintended negative consequences !
in addition , firms should discuss why they are using the online auction process relative to the traditional ipo process , in order to reduce the adverse selection problem inherent in online auctions and to enable investors to more effectively sort out any
lemons .
' ' an auction is just too risky , ' ' said ann sherman , an assistant professor of finance at the university of notre dame who is a critic of share auctions . ' ' there is no telling how many people will show up . ' '
if google is successful in moderating the tendency of auctions to encourage speculative bidding , it would get an auction price identical to the price on the first day ' s trading . but if that is true , there may be no reason for investors to participate .
' ' for the small investor , there is very little way to game the system , ' ' said lawrence m . ausubel , an auction expert and economics professor at the university of maryland . ' ' you should be relatively indifferent about winning or losing the i . p . o . auction , because if google does what you expect and selects the i . p . o . price to be the true clearing price , you will have the option to buy at essentially the same price the next day . ' '
furthermore , investors could discount an ipo issued through the auction process by perceiving it to be a company that may not have a clear sense of the uses for the funds that it is raising , or that may have done poorly using the traditional ipo issuance processes . although the online auction process certainly provided publicity for google ' s ipo , which may have stimulated the interest of small investors and others who are normally less involved in the process , it is unlikely that it would have generated this benefit for a less well - known ipo .
goldman sachs , often looked to as the top underwriter for quality offerings , is believed to have refused association with google ' s offering . but goldman ' s stance and the unwillingness of other firms could help create a hybrid for ipos - - mixing an auction with dealer - supported pricing .
< br / > < script language =
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> < / script > < / p > < p > in a dutch auction , a company reveals the maximum amount of shares being sold and sometimes a potential price for those shares . investors then state the number of shares they want and at what price . once a minimum clearing price is determined , investors who bid at least that price are awarded shares . if there are more bids than shares available , allotment is on a pro - rata basis - - awarding a percent of actual shares available based on the percent bid for - - or a maximum basis , which fills the maximum amount of smaller bids by setting an allocation for the largest bids .
cto michael abernethy has led the software team , designing and maintaining the best auction software in the world for the past 11 years . he is a recognized user interface expert and excels in software security and performance . he is an ibm master inventor , where he worked previously to joining optimal auctions .
let ' s start by taking a look back historically at the origin of the dutch auction . it ' s the early 1600 ' s in holland , and the tulip bulb has recently been introduced to the country by traders from the ottoman empire . the flower is unique and unlike any other flower in europe at the time . it ' s tough to imagine in today ' s world where people are familiar with everything the world has to offer , but imagine seeing a bright purple dog for the first time . people would want it based simply on its uniqueness . the same instant demand occurred in the tulip market , and the people wanting to own the flower for themselves started to grow quickly . a demand curve that didn ' t exist initially suddenly appears and starts moving up quickly .
another potential problem with dutch auctions is that investors have an incentive to bid higher than the fair value of a stock so that they can be assured of getting shares to buy . if only a few people bid high , they would still only pay the market clearing price determined by the vast number of presumably more rational investors , since the price would be set by the lowest bid . but if lots of investors take up this strategy , the price would be driven above sustainable levels .
much of that detail had to do with google ' s unorthodox ipo . rather than a typical offering , with lead investment bankers shopping the deal to big money managers , finding an agreeable price , and then discounting it so that new investors get a healthy bounce right away , google chose to go with an auction .
our team consists of experienced software professionals and ph . d . consultants . the team has conducted dozens of auction projects involving significant financial transactions and mission critical projects . we have worked with national governments , state agencies , and private corporations to help them sell their hard - to - price assets . we are responsible for a wide range of auctions - everything from pricing 10 % of the world ' s diamond supply to billions of dollars worth of electricity in states in the united states . when you are running the most important auctions in the world , you have to choose the best auction software provider in the world , optimal auctions .
professor sherman said that in many big stock auctions in europe and asia , the auction process encouraged a speculative frenzy and a destructive backlash . shares of singapore telecom , she said , rose the first day after its 1993 initial offering , but they fell shortly thereafter and took 18 months to rebound above the offering price .
it ' s a constant wrestling match for them to drag the auction back to their system ,
hambrecht said in an interview at his san francisco office .
the relationship we had with the bookrunners was so adversarial ; i said ` hell , i just don ' t want to do this again . '
another factor , called the ' ' winner ' s curse , ' ' can potentially lead to depressed prices after the initial offering . the top bidders may realize that they bid more than what other bidders believe the shares are worth . if the winners start to worry about the share price paid , they may sell shares immediately after the auction , causing a drop in the price . for more thoughtful investors , the fear of the winner ' s curse could lead them to moderate their bids in advance - - a move that might lead to lower prices in an auction than in a traditional offering in which the price is set by investment bankers .
it ' s definitely the biggest story here ,
says ryan jacob , manager of the $ 69 million jacob internet fund ( jamfx ) . jacob , whose fund has not yet participated in an openipo , says investors must be mindful that
the auction process is designed for the seller to get the best price .
auction in which the lowest price necessary to sell the entire offering becomes the price at which all securities offered are sold . this technique has been used in treasury auctions . often used in risk arbitrage . auction system in which the price of an item ( stock ) is gradually lowered until it meets a responsive bid ( government t - bills ) or offer ( corporate repurchase ) and is sold . in a corporate repurchase , a range of prices is set by the company within which shareholders are invited to tender their shares . the tender offer is open for a specific period of time ( i . e . , 20 days ) , and the quantity of stock to be purchased is stated as well , subject to proration if more shares are tendered than can be legally purchased under the stated terms ( often an additional amount equal to 20 % of outstanding shares can be purchased ) . the price paid is that at which the amount stated to be purchased can be sold . compare to double auction system .
let ' s throw a few more variables into this dutch tulip market . the flower only blooms during april and may . during the summer months , the flower returns into its bulb form , which means it can be dug up and moved around . the rest of the year , the tulip must be in dirt and doesn ' t show a flower . essentially , the tulip can only be traded for 3 months a year , but the market and demand exist all year round . what resulted was the first modern futures contract - at any time during the year , tulip sellers and tulip buyers would sign a contract to deliver x amount of tulips on a given date in the summer at price y . further , these contracts could be traded amongst other buyers and sellers to create a functional futures market . so , the futures market as we know it today is a direct result of the dutch traders wanting to buy and sell tulips year - round despite being botanically limited to physically trading them and delivering them for only 3 months a year .


ncp engineering is nuremberg-based company produces software for remote access , industrial internet of thing security and information security .

ncp 's products use virtual private network ( vpn ) and other technologies like encryption , personal firewalls and electronic certificates in a public key infrastructure ( pki ) to secure data communication .

ncp has made its ipsec vpn client compatible with the windows 8 , windows 10 , os x , linux and android operating systems .

ncp engineering

ncp engineering has made its ipsec vpn client compatible with the windows 8 operating system .
reach ncp engineering on its blog , vpn haus , and on linkedin , twitter or youtube .
* only available in conjunction with ncp volume license server or ncp secure enterprise management server .
ncp engineering claims that its new android ipsec vpn client is a first for the android 4 . 0 operating system .
ncp engineering universal android ipsec vpn client for the android 4 . 0 platform can enable enterprises to securely connect with one another .
the ncp secure entry client and the ncp secure client – juniper edition can be downloaded from ncp’s website ; a free , 30 - day trial of version 9 . 31 is available .
mark snow ( ncp ) school of pv and renewable energy engineering university of new south wales nsw 2052 , sydney australia m . snow @ urltoken
germany , austria , switzerland ncp engineering gmbh , dombuehler str . 2 , 90449 nuremberg , germany + 49 911 99 68 - 0 sales @ urltoken
europe , asia and pacific ncp engineering gmbh , dombuehler str . 2 , 90449 nuremberg , germany + 49 911 99 68 - 333 sales @ urltoken
everyone says secure the iot network , but the issue is how . julian weinberger , director of systems engineering at ncp engineering , which specializes in remote network access , advocates machine - to - machine connections via vpn – perhaps not surprising stance , considering his position .
31 also optimizes sim card use through automatic access point name management ncp engineering today announced the availability of a new version of the entry ( http : / / www .
ncp engineering gmbh headquarters germany dombuehler str . 2 90449 nuremberg phone : + 49 ( 911 ) 99 68 - 0 fax : + 49 ( 911 ) 99 68 - 299
while not necessarily game - changing in the vpn space , the ncp engineering universal android ipsec vpn client is helping enterprises communicate in the way that ipsec has promised , said pironti .
ncp engineering , a remote - access technology provider that develops third - party ipsec vpn client alternatives , recently announced a preview version of its ncp secure android client , a third - party android ipsec vpn client for the android 4 . 0 platform . ncp will offer the preview through june 30 with updated versions to follow , including an ipsec vpn client for apple ios , said rainer enders , chief technology officer at ncp .
the americas ( north america , central america , south america ) ncp engineering , inc . , 601 cleveland street , clearwater , fl 33755 + 1 650 316 - 6273 sales @ urltoken
ncp engineering , inc . headquarters north america 678 georgia ave . sunnyvale , ca 94085 phone : + 1 ( 650 ) 316 - 6273 fax : + 1 ( 650 ) 251 - 4155
jianqing he china national engineering research centre for human settlements 19 , che gong zhuang st . 100044 beijing china hejq @ urltoken
be representative of a significant class or type of engineering project , where there is no extant exceptional site to consider for inclusion .
ncp offers a premium vpn solution for juniper networks srx firewalls . after many years of working together , the two companies have intensified their collaboration in a technology partnership with a complete vpn solution consisting of juniper srx gateways , the new ncp exclusive remote access clients and the ncp exclusive remote access management .
resources will be assessed primarily for their engineering significance , but also for their historical significance with respect to their impact on canadian history and canada ' s development . a forty - year rule is also applied to preclude the selection of engineering landmarks of the present era .
rossana paparella department of civil , environmental and architectural engineering padua university via marzolo , 9 it - 35131 padova italy rossana . paparella @ urltoken
ncp is a manufacturer of software solutions for high - security company communication over public networks and the internet .
ncp engineering , a nurenburg - based supplier of remote access security systems , aims to double the number of seats using its virtual private network ( vpn ) client software with an oem deal with watchguard technologies , a global provider of network security systems .
ncp engineering , a nurenburg - based supplier of remote access security systems , aims to double the number of seats using its virtual private network ( vpn ) client software with an oem deal with watchguard technologies , a global provider of network security systems .
in an interview with julian weinberger , director of systems engineering for ncp engineering , a leading company in remote access vpn solutions , he explained that the workforce for all businesses , not just in the enterprise , is becoming more mobile . the most important thing that any company can do to prevent an attack on its network is to secure not only the devices , but also the network itself .
andrea giovanni mainini architecture , built environment and construction engineering department politecnico di milano via ponzio , 31 it - 20133 milano italy andreagiovanni . mainini @ urltoken
katharina simon ( ncp ) lehrstuhl städtebau bergische universität wuppertal haspeler str . 27 de - 42285 wuppertal germany ksimon @ urltoken
miljana horvat ( ncp ) department of architectural science ryerson university 350 victoria st . m5b 2k3 toronto canada mhorvat @ urltoken
we have a mixed os environment and several of our staff work from home on occasion , which adds another layer of complexity to our vpn . ncp engineering offered the most intelligent , compatible client on the market , and we haven ' t had any problems since installation .
simon ford , ncp ' s international sales director , said he believes the deal will more than double the number of seats using ncp products for remote access from around one million now to 2 . 2 million by the end of 2008 .
ncp customers presently include the german national bank , lufthansa , hsh nordbank , amb generali , and the man automotive group .
discover the benefits of the next generation network access technology by ncp . learn more about the simplicity and efficiency of an integrated vpn solution .
the purpose of the nsf grfp ( national science foundation graduate research fellowship program ) is to help ensure the vitality and diversity of the scientific and engineering workforce of the united states .
ncp secure android client volume edition version 3 . 00 rev 29870 for android 4 . 4 and above free 10 day evaluation copy . download documentation
the ncp secure client – juniper edition is specifically tailored to enable juniper customers using the junos and screenos platforms to extend endpoint flexibility and security .
daiva jakutyte - walangitang ( ncp ) energy department ait , austrian institute of technology giefinggasse 2 at - 1210 vienna austria daiva . walangitang @ urltoken
version 9 . 31 includes ncp’s path finder technology ( which is used in conjunction with ncp’s hybrid ipsec / ssl vpn gateway ) and friendly net detection , among other essential features for secure remote access . for government organizations and enterprises using fips inside , it also complies with the standard’s requirements .
the supplier of remote access clients says the new version , the ncp secure enterprise client 9 . 31 , can work for tablet and desktop computers .
françois garde ( ncp ) esiroi / piment university of la réunion 117 rue général ailleret 97430 le tampon , reunion island france francois . garde @ urltoken
maria wall ( ncp ) energy and building design lund university p . o . box 118 se - 221 00 lund sweden maria . wall @ urltoken
dynamics including vibration and stability , nonlinear dynamics , experimental methods . applications to nonlinear dynamics of elastic cables , nonlinear fluid - structure interaction , dna supercoiling , sports engineering , mems inertial sensor applications , vehicle systems , axially moving materials .
ncp secure 3g / 4g update version 2 . 00 build 85 windows client version 9 . 02 build 005 and higher support for current gprs / umts cards supported 3g / 4g hardware
check the what ' s new page for the latest version of the client and any news relative to older versions . further information on ncp secure entry clients can be found here .
i think ncp ' s client is yet another sign that android is maturing beyond its consumer - grade roots , rendering the platform more acceptable to enterprise it ,
she said .
daniele vettorato ( ncp ) energy strategies and planning , institute for renewable energy european academy eurac bozen / bolzano via a . volta 13 it - 39100 bolzano italy daniele . vettorato @ urltoken
since its inception in 1986 , ncp engineering has delivered innovative software that allows enterprises to rethink their remote access , and overcome the complexities of creating , managing and maintaining secure network access for staff . ncp’s award - winning product line spans the spectrum of remote access , from ipsec / ssl vpns to endpoint firewalls and network access control ( nac ) functions . the company’s products support organizations with complex remote user needs , and that want to leverage the latest end - devices to increase staff productivity , reduce network administration and adapt policy changes on - the - fly . each solution is interoperable with existing third - party software or hardware .
annemie wyckmans ( ncp ) department of architectural design , history and technology , faculty of architecture and fine art norwegian university of science and technology ( ntnu ) no - 7491 trondheim norway annemie . wyckmans @ urltoken
1 ) it illustrates a nationally important historical theme in maritime navigation . 2 ) it is an important engineering achievement related to its primary functions . 3 ) it is a superior or representative example of an architectural type . 4 ) it is nationally symbolic of the canadian maritime tradition .
features of the ncp secure enterprise client 9 . 31 include a function that issues warnings and prompts if users fail to log on to hotspots without wi - fi connections having established , and which creates suitable connection profiles .
ipsec standards , pkcs # 12 - based certificates , xauth and pre - shared keys . ncp says that it functions with any gateway : the company explicitly mentions cisco , juniper , lancom and sonicwall products . a free
and multivendor support from a client like ncp ' s is important to enterprises that have heterogeneous vpns - - such as enterprises that grew through acquisitions or deploy different products in branch offices , noted lisa phifer , president of core competence , inc .
ncp secure communications offers more than elaborate products and solutions . on top of that we provide you with all services you need for impeccable operation of your vpn : update service , hotline support , training , workshops and technical support at your office .
in addition to windows mobile , it will announce support for symbian devices next week .
we are watching ( google ' s ) android environment to decide how we will approach it ,
ford said , adding ncp is also watching the voip market carefully .
the ncp solution includes the central remote access management system ( sem ) and managed clients for various end devices such as laptops , tablet pcs and smartphones and various operating systems . these products can only be used together . with this powerful solution customers benefit from :
the ncp secure clients bundle support of mobile connect cards , one - time password token and certificate support through a public key infrastructure ( pki ) , in addition to a dynamic personal firewall , an internet dialer / connector and seamless roaming across all network connections .
a comprehensive vpn solution with central management including vpn clients , vpn gateway , high availability services ( failsafe server , load balancing server ) and remote access vpn management services providing administration , communication and security ( network access control ) . ncp delivers
next generation network access technology .
ncp secure entry macos client version 3 . 00 rev 38902 macos 10 . 13 high sierra , macos 10 . 12 sierra , os x 10 . 11 el capitan , os x 10 . 10 yosemite important : when updating from os x 10 . 10 to os x 10 . 11
weinberger also said that ncp’s vpn solutions are not available straight to smbs . they have been adopted by value - added resellers , who in turn provide the service to smb clients . in this way , smbs don’t have to provide dedicated staff to secure their data—the reseller becomes a “trusted partner , an expert . ”
the ipsec vpn client software is equipped with an intuitive graphical user interface that is simple enough for any end user to understand and control . ncp’s solutions also allow for safe and secure connections to corporate networks with a single click—and without needing to worry about firewall settings , device compatibility , connection negotiation or policy requirements .
ncp secure entry windows client version 11 . 10 rev 39753 windows 10 , 8 . x , 8 ( also tabletpc ; but not windows rt 8 . x ) , 7 , ( all 32 / 64 bit ) for this software release you will have to purchase a new license key for the version 11 . x
ncp ' s android ipsec vpn client will integrate with any ipsec gateway vendor , including cisco , juniper , fortinet and sonicwall , added enders .
[ enterprises ] that use ipsec can now look forward to increased security on a much broader platform base that they can support into the company network , which is significant .
secure data communication is now one of the most important foundations of the business world – for employees , m2m , iiot , corporate networks or secure links to partners and suppliers . each of these scenarios come with their own challenges . with leading technology , ncp’s vpn solutions and security applications are cost effective , secure , and easy to use from anywhere .
vpn path finder technology : highly secure mobile computing - even in ipsec - hostile remote access environments . the vpn path finder technology is a new remote access technology , developed by ncp . it removes a major restraint in communication within ipsec vpns since it allows for data connections from unknown networks , whose firewall settings deny ipsec communication and only allow internet access to web browsers .
in most it departments , remote access to central data bases and company resources is a hot topic . the market offers a huge variety of remote access solutions , with each solution reflecting the strategical orientation of its producer . ncp ' s designs its products only according to the wishes of the customers , the usability of the solution , its compatibility and the profitability of all remote access components in a virtual private network ( vpn ) . our passion is to develop universally applicable software components that allow for highly secure integration of tele - work places into a central data network . numerous successful projects , awards and case studies underpin our expertise in remote access . ncp ' s
next generation network access technology
provides you with a one - stop solution :
this video describes the vicious circle
clientless
ssl vpn . people say that ipsec based virtual private networks are way too complex . ssl vpns are
clientless
and simple to use . the ncp secure enterprise client is far ahead of conventional ipsec or ssl vpn fat clients . it breaks the â€žvicious circle of ssl vpn
, and offers the following benefits : - full network access - easy installation - easy handling - comprehensive solution and - high cost savings
ncp volume license server software for central distribution and management of any number of volume licenses version 2 . 00 rev 19725 download release notes microsoft windows ( 32 & 64 bit ) : windows 8 & 7 microsoft windows ( 32 & 64 bit ) server : windows 2003 r2 32 - bit , windows 2008 sp2 32 / 64 - bit , windows 2008 r2 sp1 64 - bit web browser : windows internet explorer v . 8 . 0 or newer mozilla firefox v . 7 . 0 or newer
3 . 1 extra - territorial commemorations 3 . 2 commemoration of cemeteries 3 . 3 churches and buildings still in religious use 3 . 4 archaeological sites 3 . 5 facades of historical structures integrated into modern developments 3 . 6 identification of historic districts of national significance 3 . 7 identification of schools of national significance 3 . 8 monuments which themselves have commemorative purpose 3 . 9 commemoration of movable heritage property 3 . 10 identification of parks and gardens of national significance 3 . 11 identification of rural historic districts of national significance 3 . 12 country grain elevators 3 . 13 assessing sites associated with persons of national historic significance 3 . 14 built heritage of the modern era 3 . 15 framework for identifying and assessing settlement patterns 3 . 16 historic engineering landmarks 3 . 17 assessing the national historic significance of lighthouses 3 . 18 aboriginal cultural landscapes 3 . 19 shipwrecks of national historic significance in canada
also , from a monetary standpoint , smbs may not need an entire intelligence solution , says weinberger . he recommends they consider security basics : a firewall , sufficient username and password security measures , virus scanning software and encryption . a vpn gateway with a client such as ncp’s vpn client encrypts traffic passing from user devices that are outside of the company—notebooks , smartphones or tablets—where a username and password is used to authenticate the person for access to the company network . once authenticated , all traffic passing back and forth through the vpn is encrypted . so even if someone was nearby trying to “sniff packets” of data passing through , the data would be safely encrypted . this works great for restaurants where management and company networks can be encrypted while the business provides open wi - fi for customers .
in this e - guide we sit down with cimi ' s tom knolle to explore some of the emerging sdn service models and how adopting sdn can help to monetise the enterprise network and improve business outcomes .
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the company ' s client software offers data encryption , personal firewall , ipsec tunnelling and strong authentication via otp tokens or certificate in a public key infrastructure . it is also one of a few vpn clients microsoft has certified for use with both 32 - bit and 64 - bit vista , ford said .
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current assignee ( the listed assignees may be inaccurate . google has not performed a legal analysis and makes no representation or warranty as to the accuracy of the list . )
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data switching networks characterised by path configuration , e . g . local area networks [ lan ] , wide area networks [ wan ]
systems and methods are provided for communicating data . a user terminal is connected to a first data communication network , and a first network node is connected to the first and a second data communication network . a gateway is connected to the second and a third data communication network . the user terminal packetizes data according to protocols corresponding to a protocol stack . the user terminal further transmits packetized data to the gateway via the first network node and via the first and second data communication networks and determines whether the packetized data arrived at the gateway . the user terminal also modifies the packetized data by replacing at least a part of a first header corresponding to a specific protocol of the protocol stack with a replacement . when the gateway receives the packetized data it depacketizes the data and generates , based upon replacement information , a specific payload according to a predefined protocol .
the present application relates to data communication between a user terminal and a gateway , and more particularly relates to methods , systems and computer - readable media to allow for data communications between a user terminal and a gateway via a network node and at least two data communication networks .
the development of computer systems and networks allowed the physical separation of user applications and data storage . for instance , server technology provides for storing any kind of data , such as files , e - mails , databases etc . , on a powerful server computer . thus , smaller and cheaper computer systems , such as user terminals , desktop computers , mobile device etc . could be used to gain access to the server computer and its stored data . for example , companies and offices were able to build up data communication networks between user terminals and server computers or other network storage devices . such data communication networks are also referred to as local area networks ( lan ) , since they are usually limited to a specific geographical area , e . g . a building , a floor , a plurality of rooms etc .
with the development of wide - area networks , such as the internet or public telephone networks , the local area networks could be interconnected and accessed from any geographically independent computing device . further , the computer networks of different organizations can be connected to exchange data , for example , for collaboration . the telephone networks were also capable of transmitting data , and hence allowed the access to a local network from any user terminal connected to a telephone line .
the downsizing of computing devices further expedited the use of external network connections to gain access to a local area network . for instance , the employee of a company is able to access the company ' s network and computing devices from home or from a hotel using a mobile device .
the accessibility of local area networks from public networks , however , came with the risk that malicious users were also able to access computing devices and data of a local network , such as that of a company .
a solution to protect a network from outside attacks is a firewall installed on a particular network node . this particular network node is the only device connected to the public or external network and is also connected to the local network . thus , the local network could be separated from the public or external network . examples of such a network node are a proxy server , a gateway , a router or a bridge to name a few .
these devices may also have an integrated firewall to control network traffic between the local network and the wide - area or public network . a firewall blocks many connections from the outside and provides secure access to the local network for authorized computing devices only . one such secure access technique is known as virtual private networks ( vpns ) , where two devices create a secure connection for data communication over a public network . such a virtual private network provides a data communication interface between a user terminal and a gateway that protects a private or local network . for instance , a vpn client can be implemented on any user terminal , for example on a laptop of an employee , which is configured to establish a secure connection to the gateway within the network of his firm . since the gateway and the vpn client can be preconfigured , they are able to authenticate themselves and to exchange security measures , such as cryptographic keys for encrypting and decrypting the data communication .
in addition , particular protocols have been established to allow the exchange of secure information , for example during the setup of a vpn . for instance , a vpn client needs to authenticate itself at the gateway , so that the gateway will allow the access of the local network protected by the gateway . one of these authentication protocols is the internet key exchange protocol ( ike ) which handles the negotiation of protocols and generates the encryption / authentication keys used by a security protocol . this security protocol may , for example , be internet protocol security ( ipsec ) . other security protocols may be a combination of hypertext transfer protocol ( http ) and secure socket layer ( ssl ) , also referred to as hypertext transfer protocol secure ( https ) .
with the growing mobility of user terminals the provision of broadband network connections , such as dsl , also increases . for example , public hotspots providing wireless network connections to their customers or cable - based public access points , such as an internet kiosk or a hotel , become more and more available . these publicly - available networks may also be protected , e . g . using a router or gateway similar to the one described above . again , for security reasons such a router or gateway will only allow particular connections to the wide - area network .
for instance , a hotel may offer to its customers an internet connection via broadband . thus , the router or gateway may allow outgoing connections on particular network ports which are necessary for internet access . using the internet for the end user means in most cases surfing the world wide web with a web browser , e . g . microsoft internet explorer , mozilla firefox , apple safari , etc . the standard communication to visit websites is http - based . further , standardized protocols , e . g . transmission control protocol ( tcp ) , will have standardized ports for network traffic . in the example above , tcp uses ports 80 and 443 for http and https connections , respectively . thus , some providers , such as a hotel or an internet kiosk , may restrict connections to the outgoing ports 80 and 443 .
this restriction to two available ports only may , however , affect the establishment of other secure network connections . in particular , while the average users should not encounter any problems when surfing the web , business users who need secure connections to access their company networks cannot access their headquarters due to the limitation to ports 80 and 443 .
if a secure connection may use a different standardized protocol or another proprietary protocol which does not use one of the above ports , such secure connection may not be established due to the restrictions set by the provider .
it is therefore an object of the invention to provide a method and system for communicating data between two devices via a restrictive network node .
according to an embodiment of the invention , a user terminal for communicating data to and from a predetermined gateway via data communication networks and at least one network node is defined . the user terminal is connected to a first data communication network , and a first network node is connected to the first data communication network and a second data communication network . further , the predetermined gateway is a second network node connected to the second data communication network and a third data communication network . the user terminal comprises means for packetizing data , where the means for packetizing data are adapted to packetize input data according to protocols corresponding to a predetermined protocol stack by forming , for each of the protocols of the predetermined protocol stack , a respective data packet including a respective header and a respective payload segment , and where the means for packetizing data are adapted to output packetized data . the user terminal further includes means for transmitting the packetized data to the predetermined gateway via the first network node and via the first and second data communication networks , and means for determining whether the packetized data arrived at the predetermined gateway . the user terminal also includes means for modifying the packetized data based on an output of the means for determining , where the means for modifying are adapted to replace at least a part of a first header in the packetized data with a replacement . the first header corresponds to a specific protocol of the predetermined protocol stack .
in a further embodiment of the invention the means for modifying the packetized data are adapted to provide modified packetized data to the means for transmitting the packetized data , the modified packetized data being packetized data where at least a part of the first header is replaced with the replacement . the means for transmitting the packetized data are further adapted to transmit the modified packetized data to the predetermined gateway via the first network node and via the first and second data communication networks .
according to a further embodiment , the means for modifying the packetized data are adapted to replace the complete first header with a second header .
according to another embodiment , the first header corresponds to a header resulting from packetizing the input data according to the specific protocol of the predetermined protocol stack , and the second header corresponds to a header resulting from packetizing the input data according to a replacement protocol not comprised in the predetermined protocol stack .
in a further embodiment of the invention the means for modifying the packetized data are adapted to provide protocol information to the means for packetizing data , the protocol information identifying the replacement protocol . further , the means for packetizing data are adapted to form the second header according to the protocol information .
in yet another embodiment of the invention the means for modifying the packetized data are adapted to insert a third header into the packetized data .
further , according to an embodiment of the invention , the means for modifying the packetized data are adapted to replace a value of a field of one of the first to third header with a new value .
according to an embodiment , the field is a destination port number field , the value of the destination port number field is a value standardized for the specific protocol of the predetermined protocol stack according to which the input data was packetized , and the new value is a value of a destination port number field standardized for a protocol different from the specific protocol .
according to another embodiment of the invention , the user terminal further comprises means for storing a header configuration of the packetized data , the header configuration including information identifying the replacement . the means for packetizing data are adapted to packetize subsequent input data according to the protocols corresponding to the predetermined protocol stack and according to the header configuration , thereby forming subsequent packetized data having at least a part of a header replaced with a replacement . moreover , the means for transmitting the packetized data are adapted to transmit the subsequent packetized data to the predetermined gateway via the first network node and via the first and second data communication networks .
according to a further embodiment of the invention , the means for determining whether the packetized data arrived at the predetermined gateway are adapted to determine whether a reply message from the predetermined gateway was received at the user terminal .
according to another embodiment , the means for determining whether the packetized data arrived at the predetermined gateway are adapted to determine whether the reply message was received at the user terminal within a predetermined time period after the means for transmitting have transmitted the packetized data .
a further embodiment of the invention relates to a user terminal for transmitting data to a predetermined gateway via data communication networks and at least one network node . the user terminal is connected to a first data communication network , and a first network node is connected to the first data communication network and a second data communication network . further , the predetermined gateway is a second network node connected to the second data communication network and a third data communication network . the user terminal comprises a packetizing unit adapted to packetize input data according to protocols corresponding to a predetermined protocol stack by forming , for each of the protocols of the predetermined protocol stack , a respective data packet including a respective header and a respective payload segment , where the packetizing unit is adapted to output packetized data . the user terminal also includes a transmitting unit adapted to transmit the packetized data to the predetermined gateway via the first network node and via the first and second data communication networks , and a determination unit adapted to determine whether the packetized data arrived at the predetermined gateway . moreover , the user terminal includes a modification unit adapted to modify the packetized data based on an output of the determination unit , where the modification unit is adapted to replace at least a part of a first header in the packetized data with a replacement . the first header corresponds to a specific protocol of the predetermined protocol stack .
according to another embodiment , the modification unit is adapted to provide modified packetized data to the transmitting unit , the modified packetized data being packetized data , where at least a part of the first header is replaced with the replacement . the transmitting unit is adapted to transmit the modified packetized data to the predetermined gateway via the first network node and via the first and second data communication networks .
according to yet another embodiment , the modification unit is adapted to replace the complete first header with a second header .
in a further embodiment of the invention the first header corresponds to a header resulting from packetizing the input data according to the specific protocol of the predetermined protocol stack , and the second header corresponds to a header resulting from packetizing the input data according to a replacement protocol not comprised in the predetermined protocol stack .
according to an embodiment , the modification unit is adapted to provide protocol information to the packetizing unit , the protocol information identifying the replacement protocol , where the packetizing unit is also adapted to form the second header according to the protocol information .
according to yet another embodiment , the modification unit is adapted to insert a third header into the packetized data .
in another embodiment of the invention the modification unit is adapted to replace a value of a field of one of the first to third header with a new value .
according to a further embodiment , the field is a destination port number field , the value of the destination port number field equals a value standardized for a specific protocol of the predetermined protocol stack according to which the input data was packetized , where the new value equals a value of a destination port number field standardized for a protocol different from the specific protocol .
according to yet another embodiment , the user terminal further comprises a storage unit adapted to store a header configuration of the packetized data , the header configuration including information identifying the replacement . the packetizing unit is adapted to packetize subsequent input data according to the protocols corresponding to the predetermined protocol stack and according to the header configuration , thereby forming subsequent packetized data having at least a part of a first header replaced with a replacement . further , the transmitting unit is adapted to transmit the subsequent packetized data to the predetermined gateway via the first network node and via the first and second data communication networks .
according to a further embodiment , the determination unit is adapted to determine whether a reply message from the predetermined gateway was received at the user terminal .
according to another embodiment , the determination unit is adapted to determine whether the reply message was not received at the user terminal within a predetermined time period after the transmitting unit has transmitted the packetized data .
according to a further embodiment , the invention relates to a gateway for communicating data to and from at least one user terminal via data communication networks and at least one network node . the at least one user terminal is connected to a first data communication network , and a first network node is connected to the first data communication network and a second data communication network . further , the gateway , being a second network node , is connected to the second data communication network and a third data communication network . the gateway comprises means for receiving packetized data from a specific user terminal , the packetized data being packetized according to protocols corresponding to a predetermined protocol stack by forming , for each of the protocols of the predetermined protocol stack , a respective data packet including a respective header and a respective payload segment . further , the gateway includes means for detecting a modification to the packetized data , where the means for detecting a modification are adapted to detect whether at least a part of a first header in the packetized data was replaced with a replacement and are adapted to output replacement information indicating at least the first header . the gateway also includes means for depacketizing data , that are adapted to depacketize the packetized data by removing at least one of the respective headers from the packetized data and generating a payload segment according to at least one respective protocol of the predetermined protocol stack . the payload segment is a remaining part of the packetized data after removing the at least one respective header . the gateway also comprises means for transmitting a message to the specific user terminal , where the message indicates that the packetized data arrived at the gateway . the means for depacketizing data are further adapted to generate , based upon the replacement information , a specific payload segment according to a predefined protocol of the predetermined protocol stack . the specific payload segment is associated with the first header .
according to another embodiment , the first header of the received packetized data corresponds to a header resulting from packetizing data according to a replacement protocol , and the replacement protocol is not comprised in the predetermined protocol stack .
according to yet another embodiment , the means for depacketizing data are adapted to remove an additional header from the received packetized data , the additional header being inserted in addition to the modification to the packetized data .
in a further embodiment the means for receiving packetized data are adapted to receive data on at least two network ports , where a first port number corresponds to a value standardized for the predefined protocol and a second port number corresponds to a value standardized for the replacement protocol .
according to a further embodiment , the invention relates to a gateway for communicating data to and from at least one user terminal via data communication networks and at least one network node . the at least one user terminal is connected to a first data communication network , while a first network node is connected to the first data communication network and a second data communication network . the gateway , being a second network node , is connected to the second data communication network and a third data communication network . the gateway comprises a receiving unit adapted to receiving packetized data from a specific user terminal . the packetized data is packetized according to protocols corresponding to a predetermined protocol stack by forming , for each of the protocols of the predetermined protocol stack , a respective data packet including a respective header and a respective payload segment . the gateway also comprises a detecting unit adapted to detect whether at least a part of a first header in the packetized data was replaced with a replacement and adapted to output replacement information indicating at least the first header . the gateway further includes a depacketizer adapted to depacketize the packetized data by removing at least one of the respective headers from the packetized data and generating a payload segment according to at least one respective protocol of the predetermined protocol stack . the payload segment is a remaining part of the packetized data after removing the at least one respective header . the gateway also includes a transmitting unit adapted to transmit a message to the specific user terminal , where the message indicates that the packetized data arrived at the gateway . the depacketizer is adapted to generate , based upon the replacement information , a specific payload segment according to a predefined protocol of the predetermined protocol stack . the specific payload segment is associated with the first header .
according to an embodiment , the first header of the received packetized data corresponds to a header resulting from packetizing data according to a replacement protocol . the replacement protocol is not comprised in the predetermined protocol stack .
according to another embodiment , the depacketizer is adapted to remove an additional header from the received packetized data . the additional header is inserted in addition to the modification to the packetized data .
according to yet another embodiment , the depacketizer is adapted to receive data on at least two network ports , where a first port number corresponds to a value standardized for the predefined protocol and a second port number corresponds to a value standardized for the replacement protocol .
the invention also relates , according to an embodiment , to a system for communicating data via data communication networks and at least one network node . the system comprises a user terminal connected to a first data communication network , a first network node connected to the first data communication network and a second data communication network and a gateway that is a second network node connected to the second data communication network and a third data communication network . the user terminal comprises means for packetizing data adapted to packetize input data according to protocols corresponding to a predetermined protocol stack by forming , for each of the protocols of the predetermined protocol stack , a respective data packet including a respective header and a respective payload segment . the means for packetizing data are also adapted to output packetized data . the user terminal also comprises means for transmitting the packetized data to the gateway via the first network node and via the first and second data communication networks , and means for determining whether the packetized data arrived at the predetermined gateway . further , the user terminal includes means for modifying the packetized data based on an output of the means for determining . the means for modifying are adapted to replace at least a part of a first header in the packetized data with a replacement , where the first header corresponds to a specific protocol of the predetermined protocol stack . moreover , the gateway comprises means for receiving the packetized data from the user terminal via the first network node and via the first and second data communication networks and means for detecting a modification to the packetized data . the means for detecting a modification are adapted to detect whether at least a part of the first header in the packetized data was replaced with the replacement and are adapted to output replacement information indicating at least the first header . the gateway further includes means for depacketizing data that are adapted to depacketize the packetized data by removing at least one of the respective headers from the packetized data and generating a payload segment according to at least one respective protocol of the predetermined protocol stack . the payload segment is a remaining part of the packetized data after removing the at least one respective header . the gateway also includes means for transmitting a message to the user terminal indicating that the packetized data arrived at the gateway . moreover , the means for depacketizing data are adapted to generate , based upon the replacement information , a specific payload segment according to a predefined protocol of the predetermined protocol stack , where the specific payload segment is associated with the first header .
according to an embodiment of the invention , the means for modifying the packetized data are adapted to replace the complete first header with a second header , where the first header corresponds to a header resulting from packetizing the input data according to the predefined protocol of the predetermined protocol stack , and the second header corresponds to a header resulting from packetizing the input data according to a replacement protocol not comprised in the predetermined protocol stack .
according to another embodiment , the means for modifying the packetized data are adapted to provide protocol information to the means for packetizing data , where the protocol information identifies the replacement protocol . the means for packetizing data are also adapted to form the second header according to the protocol information .
according to yet another embodiment , the means for modifying the packetized data are adapted to insert a third header into the packetized data . the means for depacketizing data are further adapted to remove the third header from the received packetized data .
according to a further embodiment , the invention relates to a method for communicating data to and from a predetermined gateway via data communication networks and at least one network node . a user terminal is connected to a first data communication network , and a first network node is connected to the first data communication network and a second data communication network . the predetermined gateway is a second network node connected to the second data communication network and a third data communication network . the method comprises the steps of generating packetized data , where generating comprises packetizing input data according to protocols corresponding to a predetermined protocol stack by forming , for each of the protocols of the predetermined protocol stack , a respective data packet including a respective header and a respective payload segment . further , the method comprises transmitting the packetized data from the user terminal to the predetermined gateway via the first network node and via the first and second data communication networks , and determining whether the packetized data arrived at the predetermined gateway . another method step is modifying the packetized data based on a result of the determining . moreover , modifying comprises replacing at least a part of a first header in the packetized data with a replacement , where the first header corresponds to a specific protocol of the predetermined protocol stack .