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CORRESP
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      ION Networks Correspondence

    ION
      Networks, Inc.

    120
      Corporate Boulevard

    South
      Plainfield,
      NJ 07080

    July
      11,
      2005

    Ms.
      Barbara C. Jacobs

    Assistant
      Director

    US
      Securities and Exchange Commission

    Division
      of Corporation Finance-Mail Stop 4-6

    Washington
      DC 20549

    Via
      Edgar
      Correspondence and Federal Express

                Re:

                ION
                  Networks, Inc. Registration Statement on Form SB-2

                SEC
                  File No. 333-124274

    Dear
      Ms.
      Jacobs:

    Reference
      is made to your comment letter dated July 5, 2005, addressed to Norman E. Corn,
      and relating to Amendment No. 1 to the Registration Statement on Form SB-2
      (the
      "Registration Statement"), the Form 10-KSB of ION Networks, Inc. (the "Company")
      for the fiscal year ended December 31, 2004, as amended (the "10-KSB") and
      the
      Form 10-QSB of the Company for the fiscal quarter ended March 31, 2005, as
      amended (the "10-QSB").

    We
      are
      filing via the EDGAR system our responses to the comments in your letter related
      to the above referenced registration and reports. The numbered paragraphs in
      this letter correspond to the consecutively numbered paragraphs in your comment
      letter. To the extent indicated, we propose to amend our registration and Form
      10-KSB in accordance with our response. For your convenience, enclosed are
      two
      marked and two clean copies of the amendment to the Registration Statement,
      the
      amendment to the Form 10-KSB and the amendment to the Form 10-QSB.

    Please
      call if you have any questions or further comments.

                Very
                  truly yours,

                Patrick
                  E. Delaney

                Chief
                  Financial Officer

    FORM
      SB-2

    Selling
      Stockholders, pg. 29

            1.

              The
                Company engaged Lipman Capital Group, Inc. (“LCG”) as an independent
                contractor in August of 2001 for a ten month period and compensated
                LCG a
                total of $60,450 in cash plus 5-year warrants to purchase 48,000
                shares of
                the Company’s Common Stock at an exercise price of $0.62 per share, which
                was the fair market value of the stock at the time of issuance of
                the
                warrants.

    LCG’s
      duties were to act as a financial consultant to the Company, primarily
      performing investor relation activities to establish a methodology and assist
      with the execution of plans designed to increase the awareness of the Company
      within the investment community.

    We
      have
      included the above disclosure in the Selling Stockholders section of Amendment
      No. 2 to the Registration Statement.

    The
      Financial Consulting Agreement was not filed as an exhibit to this Registration
      Statement due to the fact that it had expired in June of 2002 and due to the
      fact that the agreement was not deemed material to the Company during the time
      it was in effect. However, the Form of Warrant Agreement is filed as it is
      still
      in effect, (see Exhibit 4.5).

            2.

              We
                have complied with this comment as reflected in Amendment No. 2 to
                the
                Registration Statement.

    FORM
      10-KSB/A

    Management's
      Discussion and Analysis or Plan of Operations, pg. 17

            3.

              We
                have complied with this comment as reflected in Amendment No. 2 to
                the
                Registration Statement and Form 10-KSB.

            4.

              We
                have complied with this comment as reflected in Amendment No. 2 to
                the
                Registration Statement, Form 10-KSB and Form 10-QSB.

    Note
      2 Summary of Significant Accounting Policies

    Revenue
      Recognition, page 44

              5.

                The
                  hardware products that the Company sells do not include PRIISMS.
                  The
                  hardware products have software operating systems that are independent
                  of
                  PRIISMS. PRIISMS is the Company’s network management and security software
                  product that can be implemented by customers who either utilize
                  ION
                  hardware products or do not utilize ION hardware products in their
                  network. The Company is indifferent as to which products customers
                  purchase however there are network management and security benefits
                  realized by customers who combine the PRIISMS software package
                  with a
                  deployment of appropriate ION hardware
                  products.

    Note
      3 Restructuring, Asset Impairments and Other Credits, pg.
      46

              6.

                We
                  have complied with this comment as reflected in Amendment No. 2
                  to the
                  Registration Statement and Form
                  10-KSB.

    FORM
      10-QSB

              7.

                We
                  note your comment on your letter dated July 5,
                  2005.