Holograms put crimp on counterfeiters

Parkton firm promotes and sells layered technology to help companies protect their brands

March 08, 2004|By Nancy Jones-Bonbrest | Nancy Jones-Bonbrest,Special to Baltimoresun.com

What do a "Finding Nemo" DVD, a LeBron James basketball jersey, a package of Viagra and a ticket to this summer's Olympic Games in Athens all have in common?

They all contain holograms produced by OpSec Brand Protection, a Parkton-based provider of security and authentication technologies worldwide. The firm's products are used in efforts to stump counterfeiters and prevent package-tampering.

But don't let that tiny piece of intricately designed foil on a "Lord of the Rings" video game box fool you. It's not what you might think.

"It may look like just a hologram, but it's actually layers and layers of technology," said Richard M. Salomone, president of the U.S. operations of Applied Optical Technologies PLC of Britain, which includes OpSec.

And it is this technology that has brought OpSec some of the world's largest clients, including Microsoft Corp., Athens Olympics 2004, General Motors Corp., Pfizer Inc., Warner Brothers, Epson Corp. and Walt Disney Co.

In fact, OpSec recently signed a four-year contract extension to provide brand-protection technology to the National Basketball Association and its subsidiary organizations, the Womens National Basketball Association and the National Basketball Development League.

Terms of the deal were not disclosed, but NBA officials estimate that merchandise sales will exceed $3 billion for the 2003-2004 season. OpSec has worked with the NBA since 1999 and has similar contracts with Major League Baseball, the National Football League and the National Hockey League.

"The protection of our intellectual-property rights are of critical importance to us -- and it is something we treat with the highest priority," said Sal LaRocca, a NBA senior vice president. "OpSec's role in that is critical to the extent that it demonstrates to the consumer -- in a very straightforward, quick way -- that a product that bares the OpSec tag is officially licensed by the NBA."

High-tech, in a pastoral setting

With such a heady client list, one might expect to find OpSec in opulent headquarters in a prominent location. But the company and its 55 employees are tucked away among the cows and plows of northern Baltimore County. A small sign along Old York Road is the only hint of the company's location.

OpSec's factory is a full-service shop, housing all of the company's operations -- from technology to manufacturing to printing.

"We produce out of this facility, for brand protection, over one billion labels per year," Salomone said. Applied Optical's overall revenues totaled $51.4 million for fiscal 2003. OpSec constituted about 32 percent of that business.

The British parent also employs 50 at Advantage I.D. Technologies Inc. in Lancaster, Pa. The firm provides security technology to the federal government and other clients. Overall, Applied Optical has 300 employees worldwide.

"This group has been together for 10 years," said Salomone, who came to Applied Optical Technologies in 2000 after 21 years at the St. Paul-based 3M Co. "It's the people on a daily basis dealing with 1,000 licensees all around the globe and understanding the business. It's a significant strength."

Holograms are just one form of the many OVD -- optically variable device -- technologies used by OpSec. The OVD combines visually appealing and easily recognizable art with any number of security features. These devices may include threads and tags for protecting branded products, as well as for authenticating machine parts and for pharmaceutical packaging.

In addition, the company's laminates and security foils are used to stem the counterfeiting of currencies, documents, checks, identity documents and cards.

Anti-piracy efforts expand

OpSec's brand-protection business has been busy over the past two years, Salomone said, especially as more industries expand globally. And with increased computer technology aiding the sophistication of counterfeiters, the piracy of licensed products has increased steadily.

In 2001, 7 percent of world trade was in counterfeit goods, according to the Paris-based International Chamber of Commerce. The International AntiCounterfeiting Coalition in Washington estimated the value of counterfeiting at a half-trillion dollars.

"If you are successful in any product line, the odds are it will attract counterfeiters," said Timothy Trainer, the coalition's president. "While people may see purses and sunglasses on the street, there are many products -- such as batteries, cigarettes, auto parts -- that are also counterfeited.

"Legitimate companies that go and develop these products have to find ways that allow them to quickly identify their legitimate products from counterfeits," Trainer added. "For that reason, the companies are out seeking new security technologies to put on their products. This itself has become a competitive industry."

Outsmarting 'bad guys'

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