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Irdeto folds in Philips' 'CryptoWorks'

Thu, 02/16/2006 - 6:27am
Jeff Baumgartner, CED

Marking a possible wave of consolidation in the conditional access (CA) sector, Irdeto has inked a deal to take over CryptoTec, the CA division of Philips Electronics.

Financial terms were not disclosed, but Irdeto, a security firm based in The Netherlands, said it will assume the operations of the Philips unit, maker of the CryptoWorks smartcard and other content protection systems for cable, satellite, terrestrial and IPTV platforms. That will fit into Irdeto's line of CA products, which include smartcards and software-based CA systems for traditional and mobile TV services.
 
"The conditional access industry is moving toward consolidation, and Philips has been looking into various options for the CryptoTec business," said Philips Digital Networks CEO Hans Streng, noting that Philips will continue to focus on "open standards" digital rights management technology.
 
With CryptoWorks in the fold, Irdeto said it will have a total of 300 CA customers worldwide, a number that includes 100 customers from Philips alone, according to Vamsi Sistla, director of broadband and digital home/media for ABI Research.
 
Although CrypoWorks is not a "prized entity," it does represent some "low-hanging fruit" for Irdeto, which grapples in the global CA and DRM sector primarily with NDS Group and Nagravision, Sistla noted.

The deal "is a pinch hit, in my viewpoint," he said.

Although Irdeto and Philips have scored market share globally, their presence in North America has been a non-factor. There, at least on the cable front, the CA sector is dominated by Motorola Inc. and Scientific-Atlanta.

That could change, however, as cable operators move ahead on downloadable conditional access (DCAS) technologies.

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