Gemalto to shift headquarters to Washington

In a move that will help push the company into the federal market, newly formed smart-card provider Gemalto N.V. will make Washington the headquarters for its North America operations and its security and identity line of business.

"We're bolstering our position in security overall to focus on the public sector," Dave Ludin, vice president of Gemalto's public sector, told Washington Technology after a company briefing today.

Gemalto already has a U.S. federal office in Arlington, Va., but is looking at additional properties for its headquarters, Ludin said. The headquarters likely will be established some time next year, he said.

Gemalto was formed in June when smart-card company Axalto Holding N.V. of the Netherlands merged with its larger rival Gemplus International S.A. of Luxembourg in an approximately $1.1 billion all-share deal . Both companies make smart cards, or microprocessor cards, which are used for mobile phones, payment cards and identification cards for the corporate and government sectors.

In the federal market, Gemalto is hoping to get business from systems integrators who provide digital credential systems for government agencies that must comply with Federal Information Processing Standards Publication 201. Issued in February 2005 by the National Institute of Standards and Technology, this standard requires agencies to have a secure and interoperable identification and authentication system for their employees and contractors to access federal facilities and information networks. The agencies must comply with the standard by Oct. 27.

FIPS 201 is a byproduct of Homeland Security Presidential Directive 12, which requires all federal departments and agencies to issue secure and reliable forms of identification for employees and contractors.

Gemalto is also hoping to build off the work that Gemplus did for the third phase of the Transportation Security Administration's Transportation Workers Identification Credential program, Ludin said.

Gemplus was one of the subcontractors to BearingPoint Inc. of Mclean, Va., for the seven-month, $12 million phase of the program, which involved testing prototype smart cards and the biometric identification and credentialing system.

The TSA is expected to award the contract for TWIC's fourth phase later this year. The phase involves supplying enrollment and help desk services and operating the program's data management system. TSA indicated that it intended to make a final decision on the down-selected firms for this phase by the end of this week, according to market research firm Input Inc., Reston, Va.

Gemplus revamped its SafesITe Government solution, used in TWIC's prototype phase, to make it compliant with HSPD-12 and FIPS 201, and launched it in early May. The solution encompasses dual-interface smart cards, FIPS 201 applets, desktop client software, smart card readers, centralized personalization services, a smart card management system and professional services.

Down the road, Gemalto anticipates that a standard similar to FIPS 201 that will require its technology to be put in place at the state and local government level.

"There's also a strong possibility for the technology and standard to grow outside the federal government," Ludin said. Examples include programs similar to TWIC and first responder, healthcare and welfare benefits programs, he said.

Headquartered in Montrouge, France, Gemalto manufactures smart cards and point-of-sale terminals. Besides its security and identity line of business, it also has lines of business are telecommunications and financial services. Gemalto has about 11,000 employees and had combined pro-forma revenue of about $2.2 billion in 2005.

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