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NXP and Kestrel Wireless Partner to Eliminate Theft of DVDs in Retail
EINDHOVEN, Netherlands & EMERYVILLE, Calif. --(Business Wire)-- NXP Semiconductors, the independent company founded by Philips, and Kestrel Wireless today joined forces on a solution to solve the problem of DVD theft throughout the supply chain. Using NXP's leading RFID chip technology and Kestrel's RFA(TM) (Radio Frequency Activation) solution it is possible to disable DVDs at the point of manufacture and enable them at the point of sale, making goods stolen at any point during the supply chain worthless, thus eliminating the incentive for theft.
The first application of NXP and Kestrel's RFA/RFID solution will be integrated into optical media. The solution, however, is applicable to all consumer electronics products, such as MP3 players, electric shavers, toothbrushes, flat screen TVs, ink jet cartridges and flash memory.
NXP and Kestrel's network-based RFID solution opens up new opportunities for the distribution of optical media and consumer electronics. It eliminates expensive security devices, restrictive packaging and display cages, enabling a more comfortable shopping experience for consumers. Minimized product packaging creates more environmentally friendly solutions, such as paper instead of plastics. Additionally, the costs and problems of returns for DVDs and other disc-based media are reduced.
"Hundreds of millions of dollars from retailers, manufacturers and, indirectly, consumers are spent each year in order to prevent theft," said Christophe Duverne, senior vice president and general manager, Identification, NXP Semiconductors. "This collaboration with Kestrel has the potential to dramatically reduce and ultimately eradicate the theft of optical media and consumer electronics in the retail supply chain. RFID technology is transforming the manufacturing, distribution and sale of merchandise -- creating a new level of security, stimulating sales, reducing total costs and making the shopping experience more enjoyable for consumers."
Commenting on the near-term application for optical disc media, Bo Andersen, president of the Entertainment Merchants Association (EMA), said on behalf of EMA's Loss Prevention Committee, "We are excited by the promise of these types of solutions. DVD and video game theft is a problem that has gone on far too long and at a cost of millions of dollars annually. Where solutions include more environmentally and consumer friendly packaging, improve merchandising with more shelf space for discs, and reduce the cost of returns -- these are the ingredients for solutions that will greatly enhance everyone's business."
Designed for minimal disruption to existing retail Point-of-Sale (POS) systems and maximum benefit to retailers, the radio frequency chips are embedded in consumer goods that are activated by an RFA-enhanced RFID reader at the POS. When the chip is scanned, information is sent to the Kestrel network for authentication. Assuming all is correct, an enabling code is sent to the chip and the product is activated. For the unique application of DVDs and other optical media, electro-optic films are used to make the discs non-readable or readable regardless of the disc format or the playback device.
"NXP is recognized as the leading global innovator in the field of RFID technology and it's a pleasure to partner with such a pioneering company to develop new applications for our solutions," said Paul Atkinson, president and CEO of Kestrel Wireless. "We believe our solution not only enriches the consumer shopping experience, we also estimate that the resulting lower cost of security for optical products presents clear benefits to manufacturers, retailers and the consumer at the same time."
As part of the ongoing agreement between NXP and Kestrel, the companies will continue to identify and develop a variety of applications for RFA/RFID-enabled products through a series of pilot programs.
About NXP Semiconductors
NXP is a top 10 semiconductor company founded by Philips more than 50 years ago. Headquartered in Europe, the company has 37,000 employees working in more than 20 countries and posted sales of EUR 5 billion in 2006. NXP creates semiconductors, system solutions and software that deliver better sensory experiences in mobile phones, personal media players, TVs, set-top boxes, identification applications, cars and a wide range of other electronic devices. News from NXP is located at www.nxp.com.
About Kestrel Wireless
Kestrel Wireless is a network-based service provider of business solutions and enabling technologies for retailers and manufacturers. Kestrel's proprietary RFA technology allows products to be disabled at the point of manufacture and enabled at the point of sale -- virtually eliminating the threat of theft and facilitating supply chain improvements including more efficient returns and "green" packaging alternatives. Kestrel's solution offers billions of dollars in cost savings to manufacturers, retailers and consumers each year. www.kestrelwireless.com
Forward-looking Statements
This release may contain certain forward-looking statements with respect to the financial condition, results of operations and business of NXP and certain plans and objectives of NXP with respect to these items. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future and there are many factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.
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