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AuthenTec sells embedded security division to INSIDE Secure, making a stronger case for biometric authentication on the iPhone


NFC and contactless chip provider INSIDE Secure will acquire the embedded security systems division of AuthenTec, the fingerprint, identity management and secure solutions provider Apple bought earlier this year.

The transaction, valued at up to US $48M is for AuthenTec’s Embedded Security Solutions (ESS) division which designs develops and sells a range of embedded security solutions using complex encryption algorithms for protection. ESS offers three product lines: Content Protection, Security Toolkit and Semiconductor IP, NFC World reports.

According to TechCrunch, this sale suggests Apple’s interest lies more in the company’s other products, including tools for fingerprint sensors and identity management that work with NFC, and use of its patent portfolio.

“The sell-off of non-essential parts of AuthenTec’s business today probably helps Apple accomplish a couple of things. If the initial Reuters report of the acquisition remains accurate (and it should, according to government records), it recoups investment on parts of the business which aren’t essential to Apple’s plans,” the TechCrunch article continues.

Along with the Embedded Security Solutions division being sold off, AuthenTec also has a TouchChip division, a Smart Sensors division and an Identity Management division. BiometricUpdate has previously identified the Smart Sensors division as a possible gem in the Apple/AuthenTec acquisition, based on its advanced fingerprint recognition and touchpad options.

As we reported back in July, Apple purchased AuthenTec for approximately $365M.

“By owning its own fingerprint technology, Apple can add an important user authentication layer to its hardware without threatening its mobile walled garden philosophy,” Info Security Magazine suggests. “It would seem on this basis that it is almost certain that future versions of Apple products – especially the more vulnerable mobile devices – will include an integral Apple fingerprint authentication capability.”

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