, the biggest pay TV provider in Germany and Austria, yesterday confirmed what had been expected for some time, namely that it will begin using NDS’s Videoguard conditional access (CA) technology this quarter. Videoguard will be used for the company’s digital satellite subscribers. Software will be downloaded to most of the existing set-top boxes and new smart cards distributed. For older boxes that are not suitable for the new system, new smart cards from the existing CA supplier, Nagravision, will be introduced. All new digital satellite set-top boxes will come installed with Videoguard.
, which owns Nagravision, put a brave face on the news, focusing on the agreement to introduce its new smart cards, and claiming that the contract renewal represented “equivalent overall value”. There can be little doubt, however, that this is a significant reversal for Nagravision, which clearly could not win Premiere’s complete confidence.
News Corp, owner of NDS
and 22.7% shareholder in Premiere, will be smiling on both counts, as Premiere’s share price rose on the news, and NDS confirms another major TV service provider as a customer for its CA technology, which now resides in 82.7 million set-top boxes worldwide.
It has never been straightforward analysing the conditional access business, which, like any security business, is, by definition, somewhat secretive. NDS has established itself as the global market leader over the last 20 years, first launching with Sky’s analogue TV service in the UK in 1990. NDS has often emphasised to me that any company claiming that technology alone can solve content security issues is engaging, to put it politely, in wishful thinking. Technology ultimately will always have its limitations. The key is that behind every attempt to break a security system there hides a human being. It is the focus on those people, as much as the technology, that is a big part of NDS’s story.
But it’s not all fun and games for NDS. On the other side of the Atlantic the company is embroiled in a court case
with Dish Network, the operator of the DISH digital satellite TV platform. Dish claims that NDS engaged in copyright violation, conspiracy, and piracy in order to damage the company's business. If the case is proven, damages against NDS could run to hundreds of millions if not billions of dollars.
That prospect for the moment will not give too much concern to Premiere, which would appear to be well on the way to solving its pirate user problem, estimated at 1m boxes, and paving the way towards the faster digital TV growth that Europe’s largest TV market will surely support.
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