Bull, the French company with one of the longest histories in smart card manufacturing, is moving full force into the market for portable card- reading devices.
Bull announced this week the formation of XIRING, a joint venture with InfoRealite Group of Strasbourg, France, to develop and sell compact, low- cost readers.
At the same time, XIRING acquired assets of Oki Advanced Products, a division of Oki Electronics of Japan that was regarded as the leading producer of the battery-powered chip readers that show the balances remaining in electronic purses.
The former Oki Value-Checker line-including a simple balance checker and more sophisticated, wallet-like "sleeves" providing more detailed account information-makes XIRING No. 1 in pocket-size readers. The companies said they have a combined three million units in use.
"Oki decided to exit this market and held an auction for categories of assets," said Jack MacKeen, vice president of the Bull smart cards and terminals division. "Bull got the assets related to card readers," and no employees came along in the deal.
Bull is the top producer of microprocessor cards, making it the leading supplier to banks, and its patents are at the heart of much of the electronic cash and purse technology spreading worldwide. It has sold a million devices similar to Oki's key-ring-size balance checkers, many of them Visa Viewers associated with the Visa Cash trial at the 1996 Atlanta Olympics.
InfoRealite, a $55 million company, is strong in the telecommunications market and makes terminals for the French national health card system.
The companies said there are numerous synergies between Bull's cards and InfoRealite's contactless transmission technologies that lend themselves to remote card loading, high-speed identification, and electronic labeling. Mr. MacKeen also pointed out that Oki's Marlborough, Mass., location is near Bull's U.S. base in Billerica, Mass.
Like competitors led by Gemplus and Schlumberger, which share its French heritage, Bull is gearing up for an explosion in new types of cards, particularly those handling multiple applications.
In a strategic reassessment over the last nine months, Bull was split in three divisions: servers, software, and the $237 million smart cards and terminals unit. "We want the bulk of revenues in two to three years to come from new products," putting a big onus on chip cards, Mr. MacKeen said.
Bull said XIRING has the required skills in areas ranging from purses to telephone cards to pay television. It is also said to be ready for the conversion over the next three years to the single European currency, the euro.
David Levy, the former Gemplus executive who recently came to head Bull's smart cards division, cited predictions of a $300 million personal card reader market by 2003. By then electronic purses would have grown tenfold, to 500 million.