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Irdeto Acquires Blu-ray Security Unit From Rovi

Software security firm Irdeto has acquired the group that developed the BD+ security technology for Blu-ray Discs from Rovi for up to $25 million in cash, which Irdeto promises will give Hollywood studios better ways to thwart pirates.

Rovi completed the BD+ transaction on July 1, selling certain assets to Irdeto for cash consideration of up to $25 million based on the achievement of certain milestones, Rovi disclosed in an 8-K filing with the Securities and Exchange Commission.

In November 2007, Rovi -- then Macrovision -- announced that it would acquire the SPDC technology (including patents and software code) from Cryptography Research Inc. for $45 million in cash and stock.

Irdeto will combine the BD+ technology team with its ActiveCloak for Media dynamic security solution. According to Irdeto, that will yield a more robust security measure for Blu-ray than the current Advanced Access Content System (AACS), which was defeated by hackers who discovered the AACS decryption key more than four years ago.

"The aim is to let the studios to be able to distribute Blu-ray Discs and have them on the shelf longer before they get pirated," said Jan Steenkamp, Irdeto's vice president of Americas. "It's pretty much a raging war between us and the pirates -- and the pirates are never going to give up."

On the Internet video front, Irdeto's ActiveCloak customers include Netflix
and Logitech.

The BD+ standard is based on the Self-Protecting Digital Content (SPDC) architecture, which uses a renewable but static security approach. Irdeto will create a hybrid BD+/ActiveCloak content security system that can be reconfigured and renewed for each movie title, minimizing the risk that revenue from high-value movie content will be lost, according to the vendor.

The BD+ team includes about 20 employees in San Francisco and fewer than a dozen in Burbank, Calif., Steenkamp said. Irdeto will not relocate those employees, he added.

Irdeto, with co-headquarters in Amsterdam and Beijing, has 1,000 employees in 25 locations worldwide. It is a subsidiary of South African media group Naspers.