Aug. 29--Digital security giant Gemalto is expanding its Austin workforce as it gears up for wider adoption of its technology in North America.
The French company has 240 employees in Austin, which is the headquarters for its North American operations. It plans to add 40 workers, primarily engineers and marketers, by the end of the year.
Gemalto invented the smart chip used in bank cards and mobile phones and is a leading provider of smart-card products and software services worldwide.
Now the company is preparing for growth in the United States, which traditionally has been a smart-card laggard. That's because many major banks here remain wedded to old-fashioned magnetic stripe bank credit cards or debit cards, rather than smart cards, which are predominant in Europe and other parts of the world.
Although magnetic cards are more vulnerable to fraud, many U.S. banks have hesitated to change because of the costs associated with issuing cards embedded with chips. Smart credit cards encrypt a cardholders' information on a chip, and card data can't be skimmed or copied.
"The U.S. is one of the only countries in the world that is still stuck using the magnetic stripe, but that is changing," said Paul Beverly, president of Gemalto's North American operations. "It's in the beginning stages, and it's a multi-year program to replace all of the 1.5 billion credit cards in the U.S. We are building our team in Austin to address the opportunity."
Gemalto'sAustin operation also focuses on developing technology for use in mobile payment systems.
Isis, the joint mobile payment system developed by AT&T Mobility, Verizon Wireless and T-Mobile USA, is using Gemalto technology to encrypt customers' bank account information and store it in their smartphones.
Gemalto's operations date to Schlumberger Ltd., the giant oil well services company that set up an Austin research and development campus in the early 1980s.
In 1995, an Austin engineering team at Schlumberger developed a new, more flexible smart card that used open-source software to accomplish multiple tasks. The smart card business was spun off as Axalto in 2004. Axalto merged in 2006 with competitor Gemplus International to form Gemalto.
Today, Gemalto has 10,000 employees worldwide and posted revenue of $2.9 billion in 2012.
The company said Thursday that for the first half of 2013, sales at its mobile unit, which is its most profitable business, grew 8 percent due to strong demand.
"The world is becoming much more wireless and much more connected, and that means that more and more security is going to be needed," Beverly said. "All of that is going to fuel our business."
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