Interview: Gemalto CEO Olivier Piou on the Trüb acquisition

12/03/15

When Gemalto acquired Trüb AG's secure document business in February, it strengthened its already powerful presence in the market and it now threatens to dominate certain sectors.

The acquisition, which is expected to add some US$100 million to Gemalto’s revenues on a full year basis, continued an acquisitive stance by the firm that also saw it snap up SafeNet last year for $890 million.

Gemalto already had more than 12,000 employees operating out of 85 offices and 25 research centers in 44 countries. Trüb, meanwhile, supplies crucial elements to numerous national identity projects around the globe.

But it has not been all plain sailing for the digtal security giant. Last month, Gemalto had to admit allegations of hacking by UK and US intelligence agencies were true – although the spooks were reportedly unable to launch a significant theft of SIM encryption keys. 

Security Document World talked to Olivier Piou, Gemalto, CEO, about the implications of the Trüb acquisition for his firm’s current clients and, and whether this is the end of Gemalto's spending spree.

What are some of the greatest benefits for Gemalto of the Trüb acquisition?

We acquired Trüb to reinforce our leadership in high security identification documents. Trüb has very well combined secure printing with polycarbonate technology and developed a number of sophisticated patented security features which we can deploy worldwide by being together.  Trüb is a recognized and respected vendor with a great team that we are happy to have now within the Gemalto group.

The purchase creates a powerful joint presence, how do you envision the government ID market evolving over the next few years?

The citizen eDocument market is a market with a low penetration rate so we envision this market will grow over a long period. The worldwide conversion from paper identity documents to eDocuments will continue and we have a great track record in helping the government agencies make this transition. What is interesting for governments is that once deployed, the installed base of eDocuments can be leveraged to implement digital services which reduce their cost and simplify the citizen’s life.

Is Gemalto concerned about acquiring a hardware focused company as some experts are predicting that physical ID documents will be replaced by digital credentials stored on mobile phones?

The market potential for e-Identity documents remains massive. In the future, there will still be a good place and hence a significant potential for physical ID documents. Mobile ID is definitely a trend, that will develop and Gemalto is involved in many of these projects around the world, but for the coming decade at least it will only complement secure physical ID.

What trends in digital identity programs for governments will this acquisition help Gemalto stay on top of?

Trüb has a long history of secure printing and is an innovator in polycarbonate features and in security features in general. Combined with Gemalto's reach and investment power, we will offer state-of-the-art e-Identity documents which provide the best security level available. Governments will be able to deploy cutting-edge technology and different options to their citizens at an unrivalled security/cost ratio for more convenience in their day-to-day life.

India’s IT ministry last month commended domestic firms for producing, “the world’s cheapest” ID-cards under the UIDAI project – are indigenous firms a threat to multinational eID firms in terms of market share?

Domestic players will always be an option for governments where they exist. At Gemalto, we provide an unrivalled security to cost ratio and an unrivalled range of products, applications, platforms and services to all governmental agencies, worldwide. We take all costs into account, and do not intend to cut corners, reduce our investments in innovation or cut R&D, which are part of the overall cost of doing business. These innovations and premium security features are part of what customers expect from Gemalto.

Gemalto has been very proactive in its acquisition strategy, will this continue? Are there any major areas in which you still see gaps in which a purchase could strengthen your overall position?

For Gemalto, acquisitions are a tool for reaching our objectives. We may acquire a company if it enables us to further strengthen our leadership in a certain market, certain region, or accelerate a technology. Purchasing Trüb doesn’t prevent Gemalto from making other acquisitions in the future. We will continue our bolt-on acquisition strategy.

Note: Gemalto is a sponsor and exhibitor at connect:ID 2015 in Washington DC on 23-25 March. The conference programme also features Richard Outland, Technical Delivery Consultant, Government Programs, Gemalto, USA

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Gemalto CEO Olivier Piou
Gemalto CEO Olivier Piou

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