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11 April 2019

Verimatrix brand will live on post-acquisition, re-emphasizing automotive

Day 2 of NAB 2019 delivered a non-publicized nugget of information we have been trying to extract for some time – the Verimatrix brand will live on in the wake of its acquisition by smaller security compatriot Inside Secure.

Well, almost, as we probably weren’t the only party guilty of steaming straight past the Verimatrix stand obliviously at NAB 2019, as the Faultline autopilot sought out a flash of distinctive green rather than the new look morse code inspired logo. Cementing the longevity of the Verimatrix legacy will, however, come at a cost – with the Inside Secure name likely to be phased out pending a shareholder vote at the end of June.

Verimatrix President and COO Steve Oetegenn was honest about being in unfamiliar territory now as part of a publicly traded company and so apologized straight off the bat for swerving certain questions, the most pressing being the issue of workforce cuts – stating only that there had been an executive reshuffle. But Oetegenn’s new role did not take away from a long overdue and highly stimulating conversation, providing a glimpse into the merged company’s roadmap which we have been attempting to get our noses into ever since the deal with Inside Secure was announced back in December.

Now with the boring necessities out of the way, it was time to dive into the more important matter of the newly merged company’s roadmap. Where does the future lie for the new Verimatrix, a company which openly admits to trying to get out of security now for a few years, ironically getting acquired by its smaller rival? But that word rival is not entirely accurate and is intrinsically why a merged Verimatrix-Inside Secure has the ingredients to be a seriously successful security outfit – because despite having competing technologies, the customer overlap is minimal. Inside Secure has little in the way of telco contracts, we are told, while Verimatrix confesses to being less well versed in certain areas of the convoluted IoT ecosystem, chiefly connected cars which will be a focal point on the merged company roadmap. There are approximately 325 legacy Inside Secure customers, we are told.

We mentioned that pre-acquisition, Verimatrix looked to be side-lining its connected car security technology after initial promise. “We would prefer to say we de-prioritized the connected car division, which was mainly due to bandwidth issues,” said Oetegenn. The reprioritization of connected car security therefore may not be exactly what Verimatrix had in mind for its future, also citing difficulties with different partners and distribution channels, yet Inside Secure’s automotive clout appears to be performing well in the marketplace. It could be argued though that Irdeto is perhaps stronger still in automotive.

Ultimately, Oetegenn sees Inside Secure’s client technologies marrying well with Verimatrix’s server technologies.

There will also be a high emphasis on mobile banking apps, while there are still plenty of operators requiring cloud migrations, most recently with Japanese operator Jupiter Communications (J:Com) switching out legacy technology which Verimatrix bought from Concurrent years ago. This is a truly cloud native system, Oetegenn pointed out, highlighting the significance of convincing a large tier 1 Japanese telco to move to a cloud infrastructure (he couldn’t tell us which) – revamping the system over four years.

Plenty more similar upgrades to come we suspect and a beefed up Verimatrix will now be chasing even more Kudelski-occupied accounts.