In July, Apple snapped up AuthenTec for a whopping $356 million, a company that specialises in security systems such as fingerprint scanners. Now, new details have emerged revealing that Apple’s speedy decision to buy the company may have been to get its fingerprint scanners into upcoming devices.
The Next Web reports that new AuthenTec documents have been filed with the SEC while the agreement is pending regulatory approval. These documents reveal that discussions between the two companies began in late 2011, when the security firm approached “several leading consumer electronics companies,” to find out whether they would be interested in using the new technology it had developed.
Of the companies AuthenTec approached, only Apple was interested in developing the technology. Initial negotiations between AuthenTec and Apple were for a commercial agreement, in which AuthenTec would grant Apple a selection of its intellectual property, but Apple was not satisfied with the deal.
Instead, at the beginning of May, Apple decided that it wanted to buy AuthenTec rather than make a commercial agreement.
During the discussions, Apple representatives told AuthenTec that it wanted to seal the deal quickly, because of the company’s “product plans and ongoing engineering efforts,” suggesting that Apple plans to implement the security technology in imminent products. Those products could be the iPhone 5 and iPad mini, which are expected to be unveiled on 12 September.
“As a result of its focus on timing, Apple’s representatives also informed the company that Apple would not participate in an auction process and would rescind its proposal if the board decided to solicit alternative acquisition for the company,” read the PREM14A proxy statement filed by AuthenTec.
Also included in the acquisition of AuthenTec is an IP agreement, which “provides Apple with the right to acquire non-exclusive licenses and certain other rights with respect to hardware technology, software technology and patents of the company for commercialization of 2D fingerprint sensors for use in or with Apple products.”
The fingerprint technology could be used with Apple’s Passbook feature, which is set to arrive with iOS 6 this autumn. Passbook will hold all of a user’s tickets, loyalty cards, coupons and passes as a digital wallet. It is thought that Apple could introduce an NFC chip (Near Field Communication) in its iPhone 5 to work with Passbook.
TNW suggests that Apple could use fingerprint technology to verify payments and prevent thieves being able to use the digital wallet to make transactions.
On 8 May this year, AuthenTec announced the introduction of “its first smart sensor specifically tailored for secure NFC mobile commerce,” a 192 by 8 pixel fingerprint sensor which could be used to offer secure authentication for NFC transactions.
TNW suggests that the sensor could be incorporated into the home button on iOS devices.
Despite some complications during the negotiation process, AuthenTec continued to design and develop its technology for Apple, which TNW suggests is a “sign that Apple was hell-bent on integrating the technology in its products no matter what.”
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