Wave Systems to Demonstrate Endpoint Security Products with Nortel

RSA Conference 2006 Demonstration: Booth 1407,Monday, February 13 – Friday, Feb. 17 McEnery Convention Center, San Jose, CA.

Lee, MA and San Jose, CA — February 13, 2006 — Wave Systems Corp. (NASDAQ:WAVX www.wave.com) announced that at the RSA Conference 2006 it will demonstrate network endpoint security and access control capabilities implementing the Trusted Network Connect (TNC) architecture. Wave will demonstrate secure network access using its EMBASSY® secure software technology and Nortel’s endpoint security products with a PC equipped with a Trusted Platform Module (TPM). The EMBASSY technology platform is designed to support hardware security features provided by TPM security chips currently shipping in millions of personal computers.

TNC is a security architecture promoted by the Trusted Computing Group (TCG) designed to help improve the security and compliance integrity of clients during the network connection process. Developed by a TCG subgroup of more than 60 networking and technology industry companies, the TNC standard establishes a level of network access based on the configuration and integrity of the client. The TNC standard is intended to reduce security problems, lower support costs and reduce downtime caused by poorly configured or infected client systems.

"Nortel is committed to initiatives like the TNC to encourage open industry specifications. We believe strongly that secure interoperability across multi-vendor network security solutions is essential to reducing total cost of ownership,” said Peter Cellarius, Business Leader, Enterprise Security, Routing & Wireless, Nortel. "We intend to accelerate cross-vendor interoperability and certification, and drive evolution towards VoIP and Multimedia support. Our work with Wave Systems is another step towards assuring our customers of an interoperable endpoint security solution that enables enterprises to leverage their existing IT investments.”

"Wave is pleased to be working with Nortel to demonstrate improved network access, authentication and security by harnessing the potential of the TPM under the TNC standard,” said Brian Berger, Wave’s executive vice president, marketing and sales. "Our solution delivers key identity capabilities for the network authentication of users and machines as well as important integrity capabilities which help evaluate the health of a PC prior to being allowed network access.”

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About Wave Systems Corp.

Wave is a pioneer in hardware-based PC security that provides software to help solve critical enterprise PC security challenges such as data protection, strong authentication, network access control and the management of these enterprise functions.  Wave is a founding member of the Trusted Computing Group (TCG), a consortium of more than 100 companies that forged open standards for hardware security.  Wave’s EMBASSY® line of client- and server-side software leverages and manages the security functions of the TCG’s industry standard hardware security chip, the Trusted Platform Module (TPM) as well as hard drives that comply with TCG’s “Opal” self-encrypting drive (SED) standard.  Self-encrypting drives are a growing segment of the data protection market, offering increased security and better performance than most existing software-based encryption solutions.  TPMs are standard equipment on many enterprise-class PCs shipping today and have shipped on an estimated 300 million PCs worldwide.  Using TPMs and/or SEDs and Wave software, enterprises can substantially and cost-effectively strengthen their current security solutions.  Visit http://www.wave.com for more information.

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Under the Private Securities Litigation Reform Act of 1995. This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act), including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the company, its directors or its officers with respect to, among other things: (i) the company’s financing plans; (ii) trends affecting the company’s financial condition or results of operations; (iii) the company’s growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words "may," "would," "will," "expect," "estimate," "anticipate," "believe," "intend" and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the company’s ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors.

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For more information please contact:

Wave Media Contact:
Michael Wheeler
Wave Systems Corp.
413-243-7029
mwheeler@wave.com
Wave Investor Relations Contact
David Collins, Richard Land
Catalyst Global LLC
212-924-9800
wavx@catalyst-ir.com

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