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A dongle is a small piece of hardware that connects to a computer. The usual function of a dongle is to authenticate a piece of software. Without the dongle, the software will run only in a restricted mode, or not at all. Dongles are used by some proprietary vendors as a form of copy prevention or digital rights management, because it is much harder to copy a dongle than to copy the software it authenticates. Despite being hardware, however, dongles are not a complete solution to the trusted client problem.
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Wikipedia About Dongle

A dongle is a small piece of hardware that connects to a computer. The usual function of a dongle is to authenticate a piece of software. Without the dongle, the software will run only in a restricted mode, or not at all. Dongles are used by some proprietary vendors as a form of copy prevention or digital rights management, because it is much harder to copy a dongle than to copy the software it authenticates. Despite being hardware, however, dongles are not a complete solution to the trusted client problem.
History
Dongle has been used as a placeholder name since the 1970s. Its origin is unknown. The American Heritage Dictionary, 4th edition, says it is "probably 1 arbitrary coinage." A 1992 advertisement for Rainbow Technologies (now SafeNet—a dongle vendor in the U.S) claimed the word was derived from the name "Don Gall"—though untrue, this has given rise to an urban myth.
Dongle as the name of a device was used well before 1980 in the telecom industry to refer to BNC cable joiners of either gender.
WORDCRAFT was the first program to use a software protection dongle, in 1980. Its dongle was a simple passive device that supplied data to the pins of a Commodore PET's external cassette port in a pre-determined manner. This was possible because the PET cassette port supplied both power and data connections through a proprietary edge connector. It did, however, make the cassette port unusable for its intended purpose.
The two-cubic-inch (33 cm³) resin-potted first generation device was called a "dongle" by the inventor as there was no other suitable term to hand on the day. The distributor, Dataview Ltd., then based in Colchester, UK, then went on to produce a derivative dongle, which became their core business.
Dongles rapidly evolved into active devices that contained a serial transceiver (UART) and even a microprocessor to handle transactions with the host. Later versions adopted the USB interface in preference to the serial or parallel interface. Currently, the USB interface is gradually becoming dominant.
Interestingly, modern smart cards present the same feature set as modern dongles. Given this, the dongle market may be overtaken by smart cards, as smart cards are more secure and powerful by design than traditional MCU based dongles. Some dongle vendors are producing one-chip dongles, which combine the smart card and the smart card reader in the same chip. This structure makes a smart card dongle easy and stable.
Copy protection

Vendors of software-protection dongles (and dongle-controlled software) often use terms such as hardware key, hardware token, or security device instead of dongle, but the term "dongle" is much more common in day-to-day use. One particular vendor's term is HASP, standing for Hardware Against Software Piracy.



























