As with many of e.Digital's PRs, I believe that is a VERY misleading statement.
The encryption is clearly provided by DivX, not e.Digital.
What I believe really saying (but hoping to imply otherwise) is that they "expanded" MicroOS to work with secure video playback technology like DivX.
The part of the comment about proprietary hardware is in direct conflict with what RP stated in the webcast - that there was nothing patented (proprietary) in the hardware security, as it relied on a unique USB cable. If you don't believe me, listen to the webcast again.
IMO, this is just more the continuing pattern of e.Digital making misleading and sometimes outright false statements in its PRs with the goal of embellishing reality and pumping the stock price.