Busy Week in Conditional-Access Sector

Irdeto Acquires Cloakware; DirecTV Extends NDS Group Deal

By Glen Dickson -- Broadcasting & Cable, 12/6/2007 2:43:00 PM

Large vendors of condition-access technology, which is used by pay TV operators to prevent unauthorized viewing of content, have been making news this week.

Amsterdam, Netherlands-based Irdeto announced that it acquired Cloakware, a privately held software company based in Vienna, Va., for $72.5 million.

Cloakware’s encryption technology -- which makes security inseparable from the software it protects -- is used by consumer-electronics and mobile-device manufacturers including Texas Instruments, Pioneer Electronics and Vodafone.

The acquisition strengthens the range of software-based security solutions offered by Irdeto, which has long relied on secure hardware platforms like smart-card chips for its conditional-access systems but has recently expanded into software-only solutions for Internet-protocol TV, mobile TV and mobile digital-rights management.

“Through a partnership our two companies initially formed in 2003, we have personal experience with the high quality of Cloakware’s products and people,” Irdeto CEO Graham Kill said in a statement. “This acquisition strengthens our existing content-security offering, broadens Irdeto’s reach across the entire content life cycle and vertically expands our offering into new markets.”

U.K.-based NDS Group struck a major deal of its own, announcing that DirecTV extended its contract for conditional-access technology through June 2013 for both U.S.-based DirecTV, which has 16.6 million subscribers, and DirecTV Latin America, which has 4.6 million customers.

The contract extension solidifies NDS’ long relationship with DirecTV, which is in the process of changing ownership from News Corp. to Liberty Media. News Corp.-controlled NDS has actually supplied conditional-access systems to DirecTV since its launch in 1994, when DirecTV was owned by Hughes Electronics and NDS was known as News Datacom.

“NDS has consistently provided secure and flexible conditional-access technology,” DirecTV chief technology officer Rômulo Pontual said in a statement. “We have extended the term of our relationship with NDS based on the dependability of NDS conditional-access technologies and related services.”