Viisage protests Digimarc's $30 million Texas contract

Viisage Technology Inc. has filed a protest against rival Digimarc Corp.'s five-year, $30 million contract in Texas to add biometric features to the state's driver's license.

Digimarc of Beaverton, Ore., won the contract in October, beating out Billerica, Mass.-based Viisage. Digimarc and Viisage are rivals in the driver's license market, with Digimarc producing licenses for 32 states, while Viisage makes them for 15 states, according to published reports.

While Viisage officials are still evaluating Digimarc's contract to determine differences, a company spokeswoman said Viisage's proposal was for at least $10 million less.

"There is not an exact price, as the proposal contained different security options for the state driver's license," Maureen Todaro, vice president of corporate communications for Viisage, said in an e-mail. "If the state had chosen our solution then they would have specified the security options they wanted to elect and the price would have been more specific. It most likely would have been about $18 million."

If Digimarc's contract holds up to the protest within the Texas Department of Public Safety, then the company plans to base the new ID on its ExianEvident card architecture. The system includes implementation of facial verification and thumbprint matching through the company's Identity Validation Suite, which screens for fraud in both new issuances and renewals. It also includes other new layered security features, according to a company statement.

The five-year contract is anticipated to begin in the summer of 2007, with revenue recognized on a price-per-card basis.

Digimarc is scheduled to deliver certain aspects of the system in 2006 and early 2007, including a new networked image and data collection system.

Digimarc has about 580 employees and annual sales of $92.9 million, according to Hoover's Online of Austin, Texas. Viisage has roughly 210 employees and annual sales of $67.5 million, also according to Hoover's.