More than Five Billion Security Products made under license to Cryptography Research’s Semiconductor Security Technologies in 2010

The company anticipates further growth and diversification for its patented DPA Countermeasures and CryptoFirewall™ Security Core in 2011

SAN FRANCISCO, California — January 28, 2011 — Cryptography Research, Inc. (CRI) today announced that in 2010, more than five billion security products were manufactured under license to CRI’s semiconductor security technologies. Long-term R&D investments focused on developing solutions to security challenges facing a range of semiconductor security products, as well as traction in new industries, gave rise to the company’s business and technical growth in 2010.

“In 2010, we saw integration of our security technologies into a broader range of industries, largely driven by the advanced security requirements of the mobile, entertainment, government, identity, and finance industries,” said Paul Kocher, president and chief scientist at CRI. “Our penetration into the FPGA market, a key milestone for us, also signaled industry recognition for the need for robust protection from power analysis. Overall, our company’s position as one of the world’s leading intellectual property (IP) licensors to the semiconductor industry has been further solidified. In 2011, we will continue our development and marketing efforts to meet the increasing demand for hardware security technologies in existing and emerging markets, particularly where devices are becoming more highly integrated and must process increasingly-sensitive data.”

DPA Countermeasures—Increasing Demand in a Wide Range of Industry Sectors

The broadening adoption of Differential Power Analysis countermeasures was evident in 2010, with announcements of several new major agreements. Throughout 2010, the company’s licensees continued to include the vast majority of the smart card industry.

DPA is a form of attack that involves monitoring variations in the electrical power consumption of a target device, then using advanced statistical methods to derive cryptographic keys and other secrets. CRI developed the fundamental patents for DPA countermeasures and has licensed them to all major chip makers in the smart card industry. DPA countermeasures are mandatory under the standard Common Criteria protection profiles for smart cards, and are continuing to be introduced in security requirements for other industries.

Microsoft, Toshiba and Actel joined the growing list of leading technology companies to sign DPA countermeasures licensing agreements with CRI. Also, the company established its Developer Ecosystem program to enable IP providers to develop DPA countermeasures for use by licensees of CRI’s DPA patents. IP Cores, Tiempo and ESCRYPT all joined the program in 2010.

Last year also saw the first successful evaluation of security ICs under the DPA Countermeasure Validation Program. Members of NXP semiconductor’s SmartMX secure microcontrollers were evaluated by leading independent security evaluation laboratory Brightsight, which validated the effectiveness of licensed DPA countermeasures deployed in these products. In addition, Thales CEACI became the third lab accredited to conduct evaluations for the DPA Countermeasure Validation Program, joining Brightsight and T-Systems.

CRI expects continued adoption in 2011, driven by increased requirements for DPA countermeasures in industry sectors beyond the smart card space. These sectors include smartphones, point of sale (POS) terminals, FPGAs, pay television set-top-boxes, computer gaming, defense, and aerospace.

Cryptography Research has been awarded a portfolio of over 55 patents covering countermeasures to DPA attacks, with an additional 16 patent applications pending worldwide.

CryptoFirewall Security Core—Protecting Against Piracy and Counterfeiting for More Than Eight Years

CRI’s other flagship technology, the CryptoFirewall™ security core for pay TV and anti-counterfeiting applications, saw increased adoption. It has been integrated in approximately 100 million pay-TV set-top boxes worldwide to date. The CryptoFirewall is a self-contained hardware security core designed to protect cryptographic keys and computations in a chip from attack, even if surrounding components are compromised. In the pay-TV segment, the CryptoFirewall security core has maintained its perfect security track record, and both complements and reinforces the technologies used by conditional access companies.

In March 2010, CRI announced an agreement with chip manufacturer STMicroelectronics to integrate the CryptoFirewall security technology into ST's system-on-a-chip (SoC) products. CRI also integrated the CryptoFirewall security core with two additional major chip manufacturers for use in anti-counterfeiting applications. The company anticipates significant increases in demand for CryptoFirewall security cores in 2011 and beyond, with continued uptake in the Pay TV industry and in markets requiring technological solutions to prevent counterfeiting. To meet these needs, CRI plans to continue to invest in expanding its research and engineering teams.

CRI was profitable for the 15th consecutive year, increased its workforce by approximately 20 percent, and was selected as one of the “Best Places to Work in the Bay Area” by the San Francisco Business Times.