Changes in Holography
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Looking Back, Moving Forward
How was 2004 for you? For the industry as a whole, reviewing the developments that we covered last year in Holography News, we can conclude that it was a good year for most, with many positive developments that set the scene for 2005 and beyond, but with sufficient clouds on the horizon to prevent any complacency.
In terms of markets, in the high security arena the growth of holograms on banknotes continues apace (see page 3) and this will continue to be key market notwithstanding the recent news that the new $100 and other denominations will not, in all likelihood, include a holographic feature. In other high security markets, passports took something of a back seat, for holograms at least - not because of technology concerns but because of the current pre-occupation with biometrics. But elsewhere in document protection, AAMVA's specification of holograms on all US driving licences was a significant boost for the industry, while the tax stamp market continues provide significant high volume opportunities for suppliers. There were few major developments in brand protection - although the use of holograms as the prime authentication feature on a new labelling program for pharmaceutical products in Malaysia, and the Olympics 2004 merchandising program demonstrated the continuing success of holograms in these areas. On the downside, the FDA's controversial decision to adopt RFID-based track and trace as the solution to product safety and supply chain management for pharmaceuticals in the US could have unwelcome consequences for the industry should drug regulatory authorities elsewhere in the world follow its example. In packaging, meanwhile, as the Stock watch article in this issue (see page 6) points out, it is barely possible to go out nowadays without seeing holography embellishing shop shelves on all manner of goods from luxury high end to everyday items. Innovation and Development On the technology front, holography continued to demonstrate its inherent capacity for innovation and development. The integration of holograms with other technologies for enhanced security and functionality continued apace - examples including Schreiner's KeySecure technology, Securikett's Authentikett labels, combined hologram/DNA/RFID labels from ADNAS and Holomex and enhancements to teas scribos' Holospot system (see page 8) to name but a few. In the banknote market, De La Rue, Louisenthal and Kurz all launched new security features during 2004 based on combinations of substrate, thread and foil technology. In terms of production, Newmec and Gidue both entered the market with foil applications systems, General Vacuum launched its new compact metalliser while Spatial Imaging's new Lightspeed digital hologram printer marked the beginning of new era in large format hologram origination. Aside from the developments in the ‘conventional' market for authentication and decorative devices, holography is also beginning to demonstrate its potential for use as a tool as well as a feature. Examples of this potential include Smart Holograms' development of reflection holograms as medical diagnostic devices and holographic data storage systems from Optware. Publicly-listed companies were covered in detail in the December issue of Holography News. But there was news from many other quarters as well, including the expansion plans announced by ABNH, ITW Covid, AFC and Holoshape, and AET Films' move into wide embossing on the packaging front. Louisenthal, a major player in the banknote industry, revealed that it now offers full-scale hologram production, including origination, while its former strategic partner in foils, Hueck Folien, joined the ranks of banknote suppliers with its first order for stripes for the Thai currency, signalling a potentially significant new entrant to the market. Its arrival was partially offset by AOT's decision to abandon banknote foils, while the bankruptcy of another high security supplier, Mantegazza, was staved off by its acquisition by Italian security papermaker Fabriano. Outside of the traditional industry centres of Western Europe and North America, the Far East, India and Eastern Europe and the CIS countries continue to play an increasingly important role - not just as markets for western companies but as major centres of development in their own right. Russia, a hotbed of scientific innovation, held its first regional conference this year; the commitment amongst Indian companies to quality and industry standards is an inspiration to us all, while all eyes are currently on China, the location for the 2005 Holo-pack•Holo-print which will provide the first opportunity for many western hologram companies to witness the strength and scope of this massive market. 2004's Downside So much for the positive. On the downside, RFID continues to position itself, and be viewed in some quarters, as the ‘silver bullet' antidote to counterfeiting and diversion, new technologies such as Nanoventions claim their superiority over diffractive features and high quality counterfeit holograms have been discovered on currency - notably the euro. The latter, in particular, is leading to a perceptible sense of disenchantment with holograms in terms of their claimed security benefits, technology proliferation and lax standards amongst suppliers. This topic has been covered exhaustively in recent issues of Holography News and was one of the main topics for discussion at the recent Holo-pack•Holo-print conference in Prague, a positive outcome of which was the openness of debate and willingness amongst industry participants to work collectively to address the real issues that are causing concern and counter the misperceptions behind them. All in all, not a bad year for the industry. Provided the concerns leading to disenchantment in some sectors continues to be recognised and addressed with appropriate measures, and provided hologram companies continue to invest in the new products and techniques that form the lifeblood and future of this industry, 2005 could be even better.
A Watershed Year for the IHMA
In his Chairman's report to the Annual General Meeting of the International Hologram Manufacturers' Association, Hugues Souparis identified the launch of the Secure Hologram Producer Certification Scheme as a watershed for the Association (se HN Vol 18 No 3). This Scheme, run in co-operation with Intergraf, should make a significant contribution to improving procedures in the secure hologram field, and help to raise customer awareness of the need to source secure holograms from a qualified secure producer. Souparis' company, Hologram Industries, was the first to be certified, but several others have now applied. Another important development during the year had been the negotiations with the Hologram Manufacturers' Association of India (HoMAI), aimed at building a strong relationship between the two associations and serving as a model for the IHMA's relationship with other regional or national hologram associations. An important part of the planned relationship was that the IHMA's Hologram Image Register and HoMAI's Hologram Registry would be linked so that all searches for a hologram match on either database would cover both databases, improving the likelihood of identifying matches which resulted from attempts to source illicit copies of a hologram already in use. He reported that Despite the news that the US Bureau of Engraving and Printing is casting its net wider for security features (see page 1), banknotes continue to be a good market for the holography industry. A number of new banknotes have been introduced during 2004, including two major currencies - the new Canadian dollar series which features a stripe and the two higher denominations of the newly-designed Japanese yen, each with a patch. Kurz was the supplier for both, the latter understood to be the largest single hologram order for banknotes in the industry. Other currencies that have introduced holograms to all or most of their the Board was in discussion with the China AntiCounterfeiting Technology Association (CATA) with a view to CATA establishing a hologram section, and that the IHMA was also in preliminary discussions with Russian producers interested in an industry organisation there. Souparis also reminded members of IHMA's links with Interpol and other international and national police organisations, saying that he hoped to build on these contacts in the coming year. New Board Members In the elections at the AGM, Souparis was re-elected Chairman - a post he can hold for another two years. Wilfried Schipper (Hologram Company Rako) was elected as the European representative on the Board, with Alkis Lembessis (Cavomit and Taurus) as his deputy; Umendra Gupta (Holostik India) was re-elected as Asian representative, with Khalid Khanani (Metatex) as deputy. Randy James (Pacific
Holographics) was elected as deputy North American representative and since the AGM the Board has co-opted John Halotek (ITW Covid) as the North American representative, there being no accepted nomination at the meeting. Alex Goncharsky (Computer Holography Centre, Moscow) and Ken Traub (ABNH) remain on the board for a second and fourth year respectively.
Spreading the Word
In addition to the objectives above, a key task for the IHMA in 2005 and thereafter will be to promote the positive benefits of holograms, particularly as authentication devices, as a counter to disenchantment with the technology in certain quarters, notably some parts of the high security sector. A proactive PR campaign, a greater presence at industry conferences, an improved website as a communications tool both for members and users, and a drive to increase the membership and the visibility of the IHMA are all currently underway. The hologram industry is one of the few in the authentication sector to have its own association and the IHMA is committed to building on this position and the strengths that a collective voice can provide for hologram companies.
General Vacuum's New Compact Metalliser (Pg # 5)
General Vacuum, manufacturer of vacuum metallising equipment, unveiled further details of its new compact Holosec™ metalliser (see HN Vol 18 No 2) at the recent Holo-pack•Holo-print conference in Prague.
Vacuum metallisers have until now been supplied with production widths of 800-3000m, limiting their use both financially and for production purposes among small and narrow-web hologram producers and forcing these to buy in their film and foil pre-metallised from wide web suppliers. The Holosec was designed to fill this niche and enable narrow-web producers to bring metallising in-house, thereby increasing their security of production and enabling them to take advantage of the specialised treatments the system offers. The Holosec combines the vacuum chamber, unwind and rewind units, plasma pre-treatment, demetallization and evaporation source within one compact unit with a footprint of 2m x 3m. In addition to the conventional aluminium used for holographic films and foils, it can coat silicon oxide, chrome, silver and copper and zinc sulphide for high refractive index films. It also offers pattern demetallisation with in-line registration and plasma pre-treatment that enhances the surface energy of the films to improve adhesion and hence quality. The run rate varies from 10m to a maximum of 200m per minute. General Vacuum, formerly Valmet and now part of the Bobst Group, declined to give prices for the Holosec, stating that these depend on specification. But it can assumed that they will be considerably lower than the prices for wide web systems. When questioned at Holopack.• Holo-print about the risks of spreading low-cost secure hologram production technology in the market, Dr Nadir Ahmed, who gave the presentation on behalf of his former company, commented that the company would check the legitimacy of customers before supply. To date, two machines have been sold with other orders in the pipeline for early 2005.
Contact: Andy Jack, General Vacuum
Equipment. Tel: +44 1706 622442;
Menzel Vision System for Web Guiding
Menzel, a German company specialising in machinery for finishing and inspection machines for textiles, expanded into similar equipment for the plastic films industry in the late 1960s, and at Holopack• Holo-print exhibited a machine vision system for control of web handling machines for holographic films. The system keeps web lines in register to improve the accuracy and quality of slitting, winding/re-winding, stamping and other hologram finishing processes. Based on the company's experience building textile and film web guiding systems, the hologram guiding system can be set to read the edge of the hologram film or a specific part of the pattern in the hologram - the camera scans across the width of the film to record the edge position, the registration mark position or the position of a specified image element. Once programmed, it feeds the image data to a sensor and a controller, which in turn adjusts the web guides to maintain the position of the web.
The Menzel vision system for holographic film costs around €17- 20,000, depending on the configuration required.
Optical Document Security
The third edition of the reference book Optical Document Security is now available from publishers Artech House. Written by Rudolf van Renesse, an expert in the field and editor and co-author of the two previous editions (published in 1994 and 1998 respectively), the book provides a comprehensive and cohesive treatment of all aspects of optical document security, according to its
The book's contents have been substantially updated and revised from the previous edition, and expanded to include coverage of additional security features and evaluation. The introduction on the theory of colours is followed by chapters on light interference and diffraction, substrate-based security, printing inks and printing techniques, printed security patterns (including screen decoded images and digital watermarks), diffractive- and interference-based security features, security design and evaluation and an introduction to biometrics. The emphasis is on both the physics of security features and their value in resisting counterfeiting, while the chapter evaluating security design looks at the human factors of first line document inspection.
The book's 350 pages contain over 270 black and white illustrations, including live security documents, and an appendix with samples of important security features. In addition, a CD-ROM is included which contains all illustrations of the book in full-colour. Author Rudolf van Renesse was senior research engineer in the Optics Department of TNO Institute of Applied Physics in The Netherlands and is now
an independent consultant on document security for government departments and banking and financial institutions. He has extensive experience in the areas of holography, optical inspection techniques, and the theory of colors and document security, and is the author of more than 80 publications in these areas, as well as a contributor to Holography News and its sister publications Authentication News and Currency News. Optical Document Security is available at the discounted price £72/$118 from Artech House -
Display Holography on the Rise
"Photopolymer is making progress ... winning projects that perhaps embossed hologram producers might have expected to supply"
We feel for Nick Hardy and Valerie Love of OpGraphics, the British company that has listed its DuPont photopolymer hologram production equipment for sale on eBay. Op has been producing display holograms for the gift and promotional trade since 1983, originally on Agfa silver halide films, then in the 1990s Nick Hardy started working with DuPont's holographic photopolymer, partly
because Agfa ceased production of its holographic films, partly because the photopolymer reflection holograms had lower noise and were more light efficient. Unfortunately, when DuPont Authentication Systems was established as a joint venture with Label Systems Inc, the company decided to restrict the distribution of its unexposed photopolymer film to authorised security hologram producers. Op were among the hologram producers which were given notice of a cessation of supply. They tried to fight this under competition law in the UK, but despite their significant investment in DuPont's production equipment and the time to perfect their processes, this was to no avail. The result: holographic production kit being offered on eBay.
The Year of Photopolymer?
The timing could not be more poignant as there appears to be an upsurge of interest in photopolymer holograms - could 2005 be the year of photopolymer? The year has started well for DAS with NASCAR's announcement of its licensed product authentication label, a numbered photopolymer reflection hologram (see page 4). To date, the North American sports licensing authentication projects have been dominated by embossed holograms. NASCAR (the most popular motor sport organisation in North America) may not rival the big national sporting leagues in popularity, but big race meetings such as Daytona and Indianapolis attract large crowds of eager souvenir hunters. Last year, DAS released its izon™ advanced photopolymer holograms, offering instant holo portraits on the film, making it particularly suitable for ID documents. And across the Pacific, Dai Nippon and Nippon Paint Co announced that Teikoku Piston Ring Co had become the first major customer for authentication holograms on Secure Image™ hot-stampable photopolymer. So photopolymer is making progress in the brand protection market, perhaps winning projects that embossed hologram producers might have expected to supply. Two announcements do not make a fully-fledged market, but do represent progress. Coming Full Circle
And now, coming full circle, Liti Holographics has announced that it is shipping a new instant holographic film suitable for reflection holograms for the home and hobby market (see page 3). Meanwhile, silver halide display holograms remain a force in the marketplace. Slavich continues to find a market in Russia and beyond for its silver halide plates and films, and Colour Holographics, which took over the production and supply of HRT holographic plates, finds a steady if not spectacular market. The company is finding a ready market for its own large format co lour holograms, while other silver halide display hologram producers remain in steady production. The availability of compact LED lights which illuminate holograms at a very high quality, and the improved recognition by holographers that they have to deliver a complete, lit and framed installation, is boosting the readiness of display artists and interior designers to consider display holograms as a medium. As one who first got involved in holography because of the excitement of such 3D images, it is reassuring and somewhat surprising to see the continuing interest in full parallax holograms, complementing and supplementing the large volume market of embossed holograms.
Liti's New Reflection Film
Liti Holographics, which offers low cost portrait hologram kits selling for $99 (see HN Vol 18, No 9), has launched a new hologram film. According to the company, this film has all the ‘instant hologram' qualities of its previous film but is now capable of making reflection as well as transmission holograms. The new film is red-sensitive, making it compatible with both the Litiholo and other hologram kits, as well as red laser diodes and even helium neon lasers.
Nigeria's New Pharma Certificate
NAFDAC, the Nigerian Food & Drugs Agency, has introduced a new certificate to be issued to authorised imported and domestically produced pharmaceuticals. The new certificate is being produced by a security printer in the UK and includes a hologram among its security features. This follows participation by Dr Dora Akunyili, Director of NAFDAC in the first Global Forum on Pharmaceutical AntiCounterfeiting, where she made contact with possible suppliers among the exhibitors.
Pharmaceuticals: a Hologram Market Expanding or Threatened?
At the time of writing, the 2nd Global Forum on Pharmaceutical AntiCounterfeiting has just finished in Paris, organised by Holography News' publisher, Reconnaissance International. One of the themes to emerge during the course of the 21/2 day meeting was the importance of authentication of genuine products as part of the system to combat counterfeit medicines, heard from speakers from national drug regulatory agencies and from pharmaceutical manufacturers. Several of the speakers implied, but Dr Thomas Zimmer of Boehringer Ingelheim explicitly stated, that the ideal authentication device for pharmaceuticals is not yet available. As Dr Zimmer was speaking in his capacity as Chairman of the Anti-Counterfeit Group of the European Federation of the Pharmaceutical Industry Associations (EFPIA), his observations must be taken seriously by suppliers - or aspiring suppliers - of authentication products to the pharmaceutical sector.
To date holograms have been the leading device used for overt authentication on pharmaceuticals, so the claim that the ideal device is not yet available can only be interpreted as a
challenge to hologram suppliers. Either holograms have failed to deliver what the pharma sector requires or hologram manufacturers have not succeeded in persuading their customers to use all the levels of security that a hologram can offer; that is first, second and third levels - overt, covert and machine read. To implement covert and machine read requires additional investment by customers in training, reading tools and - for machine read - infrastructure.
The pharmaceutical sector is ideal for the introduction of such an infrastructure. Another call at the Global Forum was for increased harmonisation of authentication and inspection systems. In a sector which is as regulated and as controlled as this one, where all medicines (at least, the legitimate ones) are distributed through a controlled system in a willing partnership between manufacturers, distributors, retailers and governments, training and equipping those who handle the goods to examine the authentication device should be feasible. As should the introduction of a machine-read infrastructure, assuming that there is commonality of what is to be read. The call for greater harmonisation results from the heterogeneity in the sector at present, which makes inpsection and examination a harder task for all involved.
At present each hologram supplier offers its own proprietary method of encoding and reading hidden data. It is impractical for a warehouse or pharmacist to be equipped with numerous hologram reading systems, each one required to read the differently encoded information on the holograms from each of the many manufacturers whose medicines they provide. Equally, government inspectors are not able to carry around numerous handheld devices. But as the well-established precedent of credit cards and bar-codes shows, distributors and retailers will equip themselves to read standardised codes if the equipment footprint, cost and training required is minimal and the compatibility is maximal.
Can the hologram industry achieve this for the pharmaceutical sector? That is to say, will the hologram industry recognise that here is a cause where collaboration on the adoption of a common approach to encoding and decoding could offer the industry the opportunity to capture that market for many years to come? Because once established, any competing technique has not just to prove itself superior, but must also overcome the inevitable reluctance of a whole sector to change the way it does things.
The hologram industry starts with a huge advantage because holograms have an established customer base in the Pharma sector. And holograms are perceived by the public as a mark of authentication - the public may not know how to examine a hologram but its presence gives a level of comfort. Yet if the industry takes no coherent action to work together, it will squander this advantage. The Pharma sector (manufacturers, regulators, even patients' groups) is making a case for the ideal authentication device, without perhaps realising that what is actually needed is an authentication system. That system could be built around holograms - but it could alternatively be built around other types of device. There are many alternatives all seeking to usurp holograms from their number one spot. Recently, RFID has made the running, in lobbying and PR terms at least, but other technologies - taggants, magnetics, complex bar-codes and others - are all looking for their ‘killer application' and see the pharma sector as ripe for their efforts. The pharma sector is giving mixed signals about the use of holograms. On one side, Pfizer, in its current generation of product authentication, is currently using colour shift inks instead of holograms as the basis for its solution; on the positive side, Malaysia's Meditag uses a three-level hologram (overt, covert and machine-read) at the heart of a system of registration and inspection. Can the hologram industry - not individual suppliers, but the industry working together - persuade the whole pharmaceutical sector that Malaysia's is the way forward, not Pfizer's?
The RFID industry successfully lobbied the US Food & Drug's Administration anticounterfeit task force so that it has identified RFID as the best way forward, although it has left the door open for other technologies by not mandating the use of RFID. This is the example the hologram industry needs to follow, because it has to persuade governments, distributors and manufacturers that the pharma sector can continue to use - or even, needs to use - holograms at the heart of an integrated system of authentication. The prize is immense, because other market sectors would follow the pharmaceuticals sector. There is no consolation prize, because surrendering this market sector to an alternative technology would give an unavoidable signal to other market sectors.
HoloTouch™ Inc, a development company based in Darien, Connecticut working in association with Atlantex Corp, has launched the BeamOne HoloTouch evaluation unit, a working demonstration of its noncontact control technique. HoloTouch was founded by R Douglas McPheters to exploit its patented process for projecting a real holographic image of a keypad or similar finger-tip control board such that passing a real item, such as a finger, through the image, activates the control (US Patent 6377238 - see H N Vol 17 No 6). Atlantex specialises in helping bring new products to market, especially in the field of electronic controls and computer accessories .
The BeamOne is a four-button box to issue instructions to a PC, to which it is connected by a USB cable. The holographic image of the buttons float about 4" (10 cm) above the BeamOne box and can be programmed to instruct the computer to perform the required functions. It is fully functional, priced at US$1995, but is characterised by Atlantex and HoloTouch as an evaluation device. Nonetheless, it has been chosen by readers of Control Engineering as ‘the most innovative human-machine interface featured in Control Engineering during the past year.' McPheters identifies HoloTouch as suiting applications where non-contact is important, such as in a sterile environment, or where switches or buttons cannot be made rugged enough for the environment. The hologram image can also be larger than the keypad it mimics, making it suitable where the device is small or vision may require assistance, such as for sight impaired people or while driving a vehicle, where a quick glance at a small button can be dangerous. The hologram is also, of course, intrinsically illuminated, so it is useful for night time or dark environments. HoloTouch and Atlantex are looking for applications partners who will adapt the HoloTouch technique into their own control devices.
HoloTouch Selected for FastTrack
HoloTouch™ Inc, the company that has developed a holographic interface for contactless control devices, has been selected for Connecticut Technology Council's FastTrack scheme for promising
high-technology start-ups. FastTrack is an advisory and matching programme that helps start-ups with innovative ideas and rapid growth potential to gain seed-stage capital and business planning input through the mobilisation of a network of investors, advisors, professional service providers and industry contacts. Commenting on the scheme, HoloTouch founder and president R Douglas McPheters said: ‘FastTrack offers potentially valuable assistance in connecting us with mentors and advisors and can promote our partnering with companies who see value in our innovative touchless, holographic actuation and control technology'.
The company has already partnered with Atlantex Corp to launch the BeamOne HoloTouch unit. This enables operators of control boards such as keypads to enter commands simply by passing a finger through holographic images that represent these commands and float in front of the device (see HN Vol 19, No 3) and is suited for applications where non-contact is important for operability of hygiene, including consumer electronics, kiosks, ATMs and medical equipment. HoloTouch and Atlantex have also announced that the BeamOne is now available with relay output, extending the
technology's reach to electronic equipment controlled by programmable logic controllers (PLCs).
already offers communication with PCs through USB, serial and other ports. According to McPheters, this latest development means that the technology can now be used in a numerous industrial applications as well, such as factory floor equipment. McPheters will be presenting a paper on the HoloTouch technology at Holopack• Holo-print 2005.
Holotek Doubles Sales and Profits
Holotek Technologies Ltd, of Sanzao Zhuhai in China, has doubled its sales and profits in 2004 and is aiming to achieve at least 50% growth in 2005. Its 2003 audited sales of RMB103m (±US$12.5m) rose to RMB210M (±$25.5m) in 2004, with net profit climbing from RMB58m (±$7m) to RMB123.5m (±$15.2m), but note that the 2004 figures are not yet audited. Although the company was not liable to tax in its first years of operation (as a start-up in the Zhuhai Economic Zone), these margins of almost 60% make Holotek probably the most profitable holographic producer in the world, both by margin and in its dollar figure. 98% of these sales are for packaging, mainly for transfer metallising of cigarette liners and cartons; 85% is on OPP with the reminder on PET. Holotek has been through ownership changes since we first reported on the company (see HN Vol 17 No 6). It was set up by Fong Teng Technology of Taiwan, but government regulations limit the investment that can be put into a mainland Chinese company from Taiwan. FT has accordingly sold its interest to four private shareholders, including the CEO Mark Chiang (as a minority owner), and Holotek operates as a subsidiary of Aimrich which is registered in Samoa. The company has also divested its former 49% holding in Yong Feng Tian Technology, a Shenzhen company that produces cigarette packaging materials. All these changes mean Holotek has also postponed its plans to float on the Hong Kong stock exchange. It had originally stated its aim was to float this year with a market capitalisation of US$150m, but it is now aiming for floatation in 2008 with a doubled capitalisation. Chiang told Holography News that the company also plans to start exporting to become a global player in the holographic packaging film market and he is hoping to sell a significant shareholding - including upto a majority stake - to a strategic overseas partner to help Holotek become this global player.
Holotek and Holo-Source Partner for US Market
Chinese wide-web hologram manufacturer Holotek Technologies Ltd and long-time American embossed hologram producer Holo-Source have set up a joint US venture, Holo-Source Materials
Company (H-SM), to market the former's holographic films for packaging in North America. Although only recently announced, the company was established about a year ago, following a long relationship between the two companies and Holotek's original Taiwan parent, Fong Teng Technology. Mark Chiang, president of Holotek, was reported in Holography News a year ago to be looking for an international partner to expand foreign sales.
Holo-Source was founded in 1986 by Lee Lacey and has been a stable part of the American holography industry. He has kept the company private and small - it currently has a staff of 13 - but it has succeeded by specialising in originations, limited-run embossing, finishing and printing. The company has worked with other US producers, such as CFC International, and for several years has also been working with Fong Teng and then Holotek to provide masters. Lee Lacey told Holography News that he has been very impressed with the quality and consistency of Holotek's production and began working with them to market their materials in North America. After a year or two of assessing the market and the best way to approach it the two companies agreed to establish the joint venture as a vehicle for expanding the operation.
H-SM is importing 22 μ OPP and 15 μ PET. It is warehousing limited stocks of popular standard patterns, but can supply custom-designed materials within 4-5 weeks, including shipping from China.
Playing the Blame Game - the Culprits in Counterfeiting
"Something designed as an authentication device prevents copying and simulation, and in the case of holograms very successfully, but not theft."
The recent deaths in Turkey due to bootleg liquor laced with lethal doses of methyl alcohol show all to clearly the lengths to which counterfeiters will go to exact their illgotten gains. It also illustrates how, whenever a catastrophe happens, man-made or natural, people look for a target to
blame and usualy select an easy one which is the wrong one, and also how there will always be people or organizations looking to turn the situation to their advantage. In this case the target was first and foremost the government, for raising the taxes on raki fourfold over two years, leading to a situation which, in the words of the spirits industry, was a ‘disaster waiting to happen'. The second target was the holograms on the labels, for failing to enable a distinction to be made between genuine raki and the lethal bootleg version. It is certainly true that governments can help create an environment in which counterfeiting flourishes. There is a point at which any tax-raising measures become counter-productive - the point being reached when they are perceived to be excessive and/or unfair to the extent that ordinary people take measures to avoid paying them. In such situations counterfeiting can flourish - particularly when it is seen as a crime in which the only victims are governments and faceless corporations - and the counterfeiters undoubtedly capitalised on this.
Holograms Not At Fault
It is not true, however, that the holograms were in any way at fault. Something designed as an authentication device prevents copying and simulation, and in the case of holograms very successfully, but not theft (as Microsoft found several years ago when its Scottish printer was raided - twice - for its stock of holograms). Blaming the holograms in this instance is about as logical as putting locks on your doors and then criticising them when thieves break in through the windows instead. This obvious fact did not deter those with an interest in RFID, however, from using the situation to promote the benefits of their technology. No sooner had news of the first deaths been reported than claims appeared in the media that the use of RFID could have prevented the tragedy. Since these reports were in the general rather than specialised media, was the hand of the RFID industry feeding such conclusions to the commentators. The fact that RFID offers unique product identification which would have made it possible to identify stolen labels disguises the fact that holograms can be equipped with similar identification at a fraction of the cost. And the comments about RFID also disguise the fact that at no point, it appears, did the theft of half a million labels - a not insignificant number - serve as an early warning of a counterfeit scam. There could only be one reason for the theft and, given the absence of any form of unique identification on the labels by which they could be traced, only one responsible course of action - namely, an immediate change of label. This did not happen - at least not until after the counterfeits had gone into circulation and done their damage. ‘Hindsight is a wonderful thing', as the saying goes, but in a case like this there was foresight in abundance too. Technology, whether RFID, holograms or other, can only go so far - at some point human intuition and intelligence has a part to play. In this case it appears to have been sadly lacking. So where does the blame lie? With the government? Their tax-raising measures have not helped, but counterfeiters need little incentive to ply their evil trade. With the technology? Not in the sense that it failed, as it was never intended to identify stolen labels. But there is certainly a case to be made in the future for adopting a ‘belt and braces' solution to both counterfeiting and theft that provides unique product identification along with authentication - something for which holograms are perfectly suited. With the manufacturers, for not taking appropriate remedial action when it would have made a difference? Certainly, the signs were there and for whatever reason, not acted on. This is a classic case where ‘doing nothing' should not have been an option. Counterfeiters The Culprits But ultimately, the blame lies with the counterfeiters for the callous way in which they have produced and distributed a lethal product for financial gain, presumably in the full knowledge of the damage it would case. Excess quantities of methyl alcohol cause lethargy, blurred vision, acute abdominal pain, coma and, in some cases death. The counterfeit raki had 200 times the permitted levels. In playing the blame game, no-one should lose sight of the real culprits in this tragedy.
No Color Holographic Paper
PROMA Technologies has introduced ‘No-Color' HoloPRISM® holographic paper comprising a new series of holographic patterns and images that display unique optical effects. Unlike typical embossed holographic paper that diffracts light and generates a rainbow of reflective colour, the ‘nocolor' patterns do not exhibit traditional colour shifting properties. According to the company, this lack of colour background means no interference with print graphics, allowing for a true demonstration of trademarked colours and brand identity. Or, as PROMA's president Frank Serono puts it ‘depth without distraction.' Victoria's Secret's gift box collection was the first commercial application for the new paper.
Vacumet Buys PROMA
Vacumet has acquired the assets of PROMA Technologies for an undisclosed sum. As result of the purchase, PROMA's 140,000 square foot Massachusetts facility will become part of Vacumet's Metallized Paper and Specialty Coatings Division. Vacumet, a subsidiary of the Scholle Corporation, manufactures a wide range of metallised products including films, paper, board and plastics, for functional barrier and decorative packaging applications, and also provides a custom metallizing service. It was founded in 1969 and has seven sites in the US. PROMA Technologies was formerly known as Van Leer Metallized Products (USA) Ltd prior to its management buyout in 2000 (see HN Vol 14, Nos 5/6). It specializes in holographic and metallized papers and has the world's largest paper metallizer at 90" wide producing HoloPRISM® papers for decorative applications, PromaVAC® metallized paper and HoloSECURE® holographic security papers for brand protection. It employs 100 people and until the acquisition, was privately-owned. Its acquisition and addition to Vacumet will develop products in both silver and holographic metallized
papers. This is the latest of a series of Vacumet acquisitions. In 1992, the company acquired the Midwestern division of Ultravac in Wood Dale, Illinois, and in 1999 it acquired the business and assets of Himac Atlanta, Georgia. In 2000, Vacumet acquired the US metallizing operations of Rexam in the UK. And most recently, it has opened a second manufacturing plant in Connecticut and transitioned its Southeast Plastic operations from Atlanta to a new 81,000 square foot facility in Austell, Georgia in January, 2005 that will house a range of metallising and slitting equipment up to 130" wide.
Contact: Ruth Kemp, PROMA Technologies;
+1 508 541 774;
Stolen Holograms Used on Counterfeits in Turkey
Up to 35 people are reported to have died in Turkey and many more have been hospitalised after consuming a bootleg version of the aniseed flavoured drink raki, which contained lethal levels of methyl alcohol. Yeni Raki, the brand that was counterfeited, is manufactured by Mey Icki , which bought the alcohol operations of the state-owned tobacco company Tekel last year. Last summer approximately 500,000 brand labels, which included a tax hologram, were stolen from the company's bottling plant in Izmir. These labels have been used on the counterfeits, making it impossible to distinguish between genuine and fake bottles. Following the discovery of the counterfeits, all Yeni Raki bottles are being recalled (up to five million) and new bottle caps, in gold instead of silver, are being introduced. In the meantime, sales have slumped by 80- 85%. The finger of blame for the tragedy is being pointed at the government for applying a series of four tax rises on spirits since coming to power in 2002, a charge dismissed by the government which is refusing to lower taxes. Questions have also been raised about the validity of holograms, the main
authentication feature of the labels, with suggestions that they have failed in their function to identify counterfeits. There have been calls for improved security on the labels, with some newspaper and television reports suggesting that the use of RFID chips could have prevented the tragedy by enabling the stolen labels to be identified. In response to these comments, the IHMA has issued a statement reiterating the need for authentication holograms to be manufactured, transported and stored under secure conditions and pointing out that the theft of the security labels should have provided a clear and early warning that a counterfeit attempt was imminent, since there could be no other explanation for their theft (the manufacturers did not, following the theft, change the labels). The IHMA has also pointed out that holograms are highly successful authentication devices that protect products from counterfeiting and alteration, but not from theft. However, many holograms now include unique identification marks, overt and covert, for supply chain management purposes which, like RFID but at a lower cost, could easily be used to identify stolen labels.
SK Hologram - Leader in Korea
Sun-Kyung Hologram (SK) is the leading security hologram producer in Korea, and the first in the country to join the IHMA. It was founded in 1987 as a division of the film and chemical conglomerate SKC and became an independent company ten years later. SK has been located in an integrated purpose-built factory in Hwa-sung City since 1999 which comprises origination, mastering and electroforming, embossing up to 760mm wide and finishing facilities. Origination technologies include 2D/3D, 3D and dot matrix under the trademarks Holoseal, Microseal, Multiseal for combinations and Nanoseal for high security images. In 2000 the company introduced a full security system and in the same year was accredited to ISO 9001. Products include hot stamping foil, HRIC laminating films for ID cards, tamper-evident and integrated security labels and shrink sleeves with additional technologies including holographic barcodes, magnetics and demetallisation. SK's principal markets are in currency, security and ID documents and brand protection. Customers include the Korean government (its holographic film is used in the thread for the Korean 5000 won), banks, the National Police Agency and the military. In brand protection it has supplied Korea's largest car manufacturer, Hyundai, with authentication labels since 1993 and also supplies Kia, GM-Daewoo and the Ssangyong Motor Company, Renault- Samsung, GM Korea Motors and so on. Outside of the automotive components market, major customers in brand protection include Samsung Electronics, LG (Household, Electronics and Fashion), Sony, Callaway and others in electronics, entertainment and consumer goods. SK's turnover last year was $5m and it currently employs 55 people. The majority of its business is in supplying the domestic market but it also exports to America, Singapore and the Middle East.
Contact: Brian Keum, SK Hologram,
Bunchon-lee, 108-4 Bunchon-Up, Hwasung,
Kyonggi-do, Korea. Tel: +82 2 2057 7223;
email: [email protected];
Hot-Stampable Flying Null Tags
Flying Null, the British company that has developed contactless magnetic tags, has moved into production of the hot-stamping foil version of its Electro-Magnetic Identification EMID) tags. Foil manufacturer Hueck Folien has been working with Flying Null on developmental formulations of a 12 μm polyester film and coatings, and helping the company to optimise these for a hot-stamp magnetic tag. According to Ian Wills, Flying Null's applications manager, this has reduced the tag manufacturing steps from 13 to seven, so the company can now offer a hot-stamp tag for use on a variety of packaging substrates at a competitive price, taking advantage of the already high base of installed hot-stamping equipment at packaging converters and printers. For those who prefer the tag in self-adhesive or wet-glue label format, it also means that Flying Null or label converters have an easy process to produce labels, simply hot-stamping the tag onto the label substrate. The process involves the sputtering of the 0.8 μm magnetic metallization on to the release-layer coated PET supplied by Hueck in one-meter wide reels. The reel is then returned to Hueck where the specified size coat is applied and the film is slit into ribbons. Flying Null then uses a Nd-Yag laser to ablate the metallised film into the encoded pattern required for each customer. Flying Null also applies a registration mark so that the hot-stamp die applies each discrete coded tag to register. Working with Hueck, Flying Null can now offer formulations to hotstamp EMI tags onto paper, board, plastics and fabrics. Authentication data tags require a ribbon about 10-12 mm long; batch information (such as date and/or place of manufacture) requires 20-25 mm and individual coding takes 25-30 mm, or about 40-45 mm if the tag is to be read through outer packaging (ie from inside a shipping carton)
This development complements Flying Null's non-exclusive licence agreements with Light Impressions and David S Smith Packaging (DSS). Some time ago LI announced the launch of Optocode™, a label that combined a hologram with a magnetic tag. According to Wills, this can now be produced as a hot-stamp foil combination, laying a hot stamped hologram over the hot stamped EMI tag, although they are also working to combine the two in one foil layer.
In the Authentication Industry, It's Time That RFID Grew Up
The emergence of the authentication industry during the 1990s was characterised on many occasions by manufacturers of the different technologies taking pot shots at one another through negative marketing that sought to promote their offerings by belittling the opposition. In this respect, hologram manufacturers were as guilty as their counterparts in other areas of authentication. But the industry has grown up and moved on, and few suppliers of any of the authentication technologies still claim to offer the mythical silver bullet, with most recognising that different technologies address different aspects of counterfeiting, diversion and other forms of piracy, but no single technology addresses them all. This recognition is evidenced by the increasing trend for erstwhile competitors to join forces, offering socalled ‘layered' solutions that combine a range of different but complementary technologies to address the needs of anti-counterfeiting, authentication and track and trace. One technology, however, that appears to be going against this trend is RFID, which in many quarters is being touted, in the words of Lester Crawford of the US Food and Drug Administration, as the ‘cornerstone technology in the fight against counterfeits because of its ability to track, trace and authenticate'. Not only are supporters of RFID actively promoting this message, but they are often doing so in the context of disparaging other solutions. As we reported in last month's Holography News, for example, such supporters were quick to capitalise on the recent deaths in Turkey caused by counterfeit liquor (in bottles sealed with genuine holograms stolen from the manufacturing plant) by claiming that the use of RFID would have prevented this from happening by allowing the stolen labels to be identified. And
as we pointed out, so would the holograms had they been sequentially numbered or equipped with some other form of unique identification. Preposterous Claims This month, in a different context but with similar undertones, a letter in the SunWeekend, a Malaysian newspaper, called for the Health Ministry to adopt RFID tags in place of holograms for the Meditag medicines authentication label. The writer, who would only be identified as a ‘pharmaceutical industry insider', claimed that holograms are not used to stem piracy and don't work anyway. (His preposterous claims were refuted by the IHMA in a letter published in the paper the following weekend.). These are just two examples of how an emerging technology is being sold on the basis of competitive disinformation in an industry which has long moved on from such practices. RFID provides significant benefits in product tracking and inventory control, which in itself helps to reduce the incidence of counterfeits by making it harder to infiltrate these into the official supply chains. But anti-counterfeiting is a side benefit and RFID is unproven for authentication purposes, expensive (both in the cost of the tags and their readers), requires significant infrastructural support and in some cases is simply not practicable (for example, the metal in blister packs interrupts the radio signal transmitted by the device). Critically, however, the signal can be hacked into and the data recorded in the device changed using simple PDAs. And not only can the data be reprogrammed, but there are major concerns about privacy. As HolographyNews' sister publication Authentication News reports, hand-held PDAs could read what type of underwear you are wearing, what books you are carrying.
They could even be used to capture personal details contained in the RFID chips that store biometric data in passports. RFID is Fallible In short, RFID is fallible, expensive and unproven. None of these factors prove that it does not have a part to play in authentication, but they certainly prove that it is not the ‘cornerstone' technology that some claim it to be. Indeed there is no such technology, because in the field of counterfeiting, along with piracy, adulteration and diversion, there is no single problem. RFID may, for example, be the best solution for an organisation with the infrastructure for supply chain logistics already in place that wants to prevent product diversion, and hence the potential for infiltration of counterfeits. But it is no good if the solution requires public verification or 100% proof of authenticity in a court of law. Holograms, on the other hand, may be the best solution for overt authentication and can be combined with other technologies to provide tracking capability. But if a covert solution is required, for example, or one that provides proof of adulteration and dilution, then holograms are not the answer. "Horses for courses", as they say. In other words, different technologies have specific benefits relating to some of the problems of counterfeiting and diversion, but each also has limitations that render them unsuitable for others. Suppliers of holograms and other authentication technologies realise this. It is time for the RFID industry and its supporters to grow up and do likewise. Until it does, the two examples quoted above show that the hologram industry cannot be complacent but needs to be both vigilant and aware of attacks such as these so that it can - through the IHMA - make an industry response These examples also point - yet again - to the need for an industry-wide media relations effort to rebut accusations that holograms don't work for security. Put simply, they do.
Meditag Launches inMalaysia
After numerous delays Malaysia implemented its Meditag pharmaceutical authentication label on May 27 2005 (see HN Vol 18, No 9). The scheme, originally due to launch on January 1, requires all dispensed medicines and over the- counter (or self-medication) pharmaceuticals to carry the authentication label, which is built around a hologram manufactured by Hologram Industries. The system is being administered by local company Mediharta, which will supervise the controlled issue of tags to importers and manufacturers and train the Ministry's inspectors to examine the holograms. The cost of the labels, in the region of one US cent each, is being borne by the pharmaceutical industry, both domestic manufacturers and importers. The launch of the Meditag system was delayed to allow the pharma industry in Malaysia to gear up for the application of holograms to all their products, but also after intense lobbying by that industry. Since the announcement of the scheme in mid-2004, it has met with fierce opposition, with the industry even
enlisting the help of the US Chamber of Commerce and the EU in its claims that the system is unnecessary, will not work,
Centro Grafico - A Well-Kept Secret
Centro Grafico was founded by Dino Radice in 1970 to print security forms, cheques, vouchers etc. In 1995, the company moved into hologram production with the purchase of a narrow web JRP embosser in order to add holograms to cheques. The equipment was used both to direct emboss images into lacquer and to produce brand protection labels for companies such as Shell and Exxon. Two years later the company bought a Holomagic dot matrix system from Ken Harris and began originating holograms in-house. The acquisition of 2D/3D origination equipment followed, along with a step and repeat system from Newport which enables shims up to 2m x 600cm to be produced. Two years later the company developed and installed its own wide web coating and embossing line to produce films and foils up to 1.6m wide. Centro Grafico, which is based near Milan, now produces a wide range of materials and products in widths up to 1.6m wide and in gauges from 16 through to 100 micron. These include OPP and PET films, cast polypropylene for in-mould labels, nylon, holographic paper, hot stamping foil and tamper-evident labels. As well as supplying end customers with finished holographic products, the company is also a major supplier of base materials to other hologram manufactures. In 2001 the company extended its product range with the introduction of high refractive index coated products and is now a leading supplier of laminates (including pouches) and thin films for ID applications. Additional facilities for the ID and high security markets include demetallisation to register (up to 800 cm wide), foil application (both roll to roll stripes via its own system as well as Dimuken equipment for patch and stripe application), four colour web intaglio printing and, most recently, a new laser engraving system for cards. Centro Grafico remains a family business, with the founder Dino Radice running the company and his son Luca responsible for R&D. It now employs 65 people in a 20,000m facility near Milan, which it says is about to be extended ‘considerably'. Turnover is approximately €15m, the majority (80%) of which is in holographic production, both finished products and base materials to other hologram manufacturers. Most of this is in security business - predominantly passports, brand protection and, increasingly, tax stamps. Its principal markets outside Italy are Europe, the CIS and the Far East. According to industry veteran Paul Samuels, who joined Centro Grafico in 2004 as Director of Business Development following more than 20 year's experience in holography with Applied Optical Technologies and CFC International, the company has been hiding its light under a bushel. ‘We are one of the best kept secrets in the industry' he said. ‘I always knew of the company as a supplier of some of the best base materials - such as foils and HRIC - in the business, but until I got talking to them about joining them I had no idea of the extent and quality of their product range. Few people do. Our key strength is our innovation and we have a superb set of facilities and technologies for security from brand protection through to banknotes.'
Contact: Centro Grafico dg, Via Einstein
76, 20010 Marcallo (M), Italy.
Tel: +39 (0) 2 976 1301,
Alfa and Digital Matrix Team Up as JRP Closes
New Jersey company Alfa Machine Co, well-known in the industry for its holographic embossing machines, and Digital Matrix (DM), manufacturer of electroforming systems, have teamed up to establish a joint operation to market to the holography industry, to be called Alfa Digital Matrix. The two companies' products complement each other, as between them they are able to supply the key equipment for producing embossing shims (DM), recombining and embossing (Alfa). The new organisation will be run by Steve Pan, formerly marketing manager at narrow-web embossing machine manufacturer James River Products (JRP). Pan's move apparently follows the closure of JRP. Since the death in 2002 of its founder Drury Baughan JRP had been run by Gary Finchum, his son-in-law. However, phone lines to the company are no longer in service, mail has been returned, and it has been reported that orders have either been turned down or unfulfilled. Steve Pan has declined to answer questions about the company, preferring to talk about his new position. Holography News will report more for the next issue.
Contact: Alfa Digital Matrix, 92 Madison Ave,
Hempstead, NY 11550, USA.
Tel: +1 516 750 0431;
email: [email protected]
Large Format Colour Pushes Growth in Display Holography
The use of large format display holograms went through a quiet period through the late 1990s, as holographers had to discover new exposure materials to replace Agfa's silver halide, prices put off corporate customers and other 3D display techniques such as lenticular images edged into holography's market. But several stalwart and determined holographers stayed active in large format display work, and recent advances are now bringing their rewards. Substrates have moved on to give better light efficiency, lower noise and better response across the spectrum to facilitate the production of true colour holograms. Importantly these new materials have simplified the post-exposure processing requirements. This, together with developments in digital origination systems, has allowed the introduction of integrated production systems to be sold as stand-alone holographic printing systems. XYZ Imaging in Canada and Zebra Imaging of Texas have both just launched such systems, to translate computer images to holograms, so we take the opportunity to look at developments in large format display holography from these companies, as well as the route taken by Colour Holographics.
Zebra Offers Imager and Haptic Workstation
Zebra Imaging, founded in 1996 by MIT Media Lab graduates Michael Klug and Mark Holzbach to develop their Hogel digital hologram system (see sidebar), has unveiled the Imager M1 high-speed
holographic imager. Using the company's proprietary and patented digital system, the Imager produces high resolution (1 mm sq Hogel) full parallax holograms in sizes up to 24"/594 mm x 33"/841 mm at an exposure rate of 20 minutes per sq ft (930 sq cm) on DuPont photopolymer (DuPont is an investor in Zebra). The M1 makes monochrome holograms but the company is developing a colour version which they aim to have available by the end of the year, president and CEO Robin Curle told Holography News. The M1, which is the latest configuration of Zebra's imaging system, is priced at $1.2m (varies depending on final configuration). The company has developed parallel marketing strategies, for the Imager and for the production of custom images. It is currently focusing on three strategic markets: government (defence and homeland security); automotive and manufacturing (Ford is a major backer and supporter of Zebra's concepts for the car industry), and architectural imaging. The Department of Defense will take the first Imager, but Zebra is kept busy making holograms for the three markets. The company runs two of the previous
generation imaging systems in-house to originate holograms for customers who only require colour or do not otherwise require their own production facility. Zebra also runs an M1 monochrome Imager in house for service customers. The masters are copied on a replicator system which produces a copy every 90 seconds. The Hogel system lends itself to large holograms and to tiling (fitting units together) to make images larger than the physical maximum size of the film. In fact, Zebra has even made a hologram of an actual-size automobile for Ford (see HN Vol 13, No 3). Customers for holograms have included Ford, Northrop Grumman, BAE Systems and others, keeping the in-house origination systems and the replicator ‘busy full-time', as Ms Curle put it. She also mentioned that it takes 30 days to build an Imager and her expectation is that they will sell all they can make. The monochrome version has limited, albeit important, applications but the company expects the colour Imager to have ‘unlimited' applications, expanding Zebra's reach into other markets. Viewing and interaction with Zebra holograms is facilitated by its Holo-touch Workstation, a display system that uses a haptic stylus to allow the operator to control the viewpoint in the hologram (a facility enabled by the Hogel optics). The operator gets pressure feedback from pushing the stylus against a part of the image and can use the button on the stylus to instruct the system to display the view from, or of, that point. This is particularly valuable in urban planning, military work and policing, for example, as it enables line-of-sight between two points to be viewed. The workstation, which has also just been launched, is priced at around $250,000, with the first one going to the US Depar
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