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Buyout puts supersecure Blackphone in one company's hands

The security-obsessed company called Silent Circle is now solely in control of its phone for encrypted communications. It has also raised $50 million and will announce new devices next week.

The first-generation Blackphone, a security-minded phone that encrypts voice and video communications.
The first-generation Blackphone encrypts voice and video communications. Eric Franklin/CNET

Silent Circle, a company specializing in snoop-proof security software and services, has bought out a business partner's stake in their Blackphone project .

By acquiring Geeksphone's stake, Silent Circle can pursue the Blackphone project more efficiently and without having to balance two companies' priorities and plans, Silent Circle said Thursday ahead of the Mobile World Congress show that begins next week in Barcelona.

As the continued use of easily cracked passwords shows, it's hard to get many people to go out of their way for extra security. But some will, and apparently investors are convinced Silent Circle will appeal to those customers, because the company also announced it has raised $50 million in funding to accelerate its plans.

The company plans to announce new devices at next week's mobile conference.

Overseeing the work is Bill Connor, Silent Circle's new chief executive who started in January. Connor formerly was president of network equipment maker Nortel.

Security is becoming an increasingly higher-profile issue. Sometimes the problem is hackers like those who penetrated Sony Pictures' network last year and published sensitive information; sometimes it's government-sponsored attacks like the US and UK spy agencies' alleged attempts -- revealed last week -- to steal mobile phone encryption key technology from SIM card maker Gemalto.

Geeksphone and Silent Circle unveiled the Blackphone at the 2014 Mobile World Congress, trying to cater to customers worried about the prying eyes of hackers and governments. The $629 Blackphone began shipping in June, running a modified version of Google's Android operating system called PrivatOS, which encrypts voice and video calls as well as text messages and anonymizes Web surfing. It's got a 4.7-inch screen, 2GHz Nvidia Tegra 4i processor, 16GB of storage and support for 4G LTE networks.

This year at Mobile World Congress, Silent Circle plans to announce new plans for building the "world's first enterprise privacy ecosystem." Details are unclear so far. But in computer-industry argot, ecosystems typically refer to an integrated system of hardware, software, services, and an app store.

"As the nature and volume of data breaches increase, institutional trust is eroding," Connor said in a statement. "There are companies that have been hacked and there are those that don't know about it yet, which means that security in the traditional sense has failed us. With the number of employees connecting to an enterprises' network using their own devices rapidly rising, organizations need a different solution."

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