(WEB HOST INDUSTRY REVIEW) — In an effort to expand its reach into the encryption business, Symantec signed a definitive agreement last week to acquire VeriSign’s security business, including its Secure Sockets Layer certificate services, Public Key Infrastructure services, VeriSign Trust Services and the VeriSign Identity Protection authentication service.
Opinion is mixed on whether VeriSign can bring new life into the longtime antivirus and computer security research groups. A combined product from Symantec for enterprise clients would be facing competition from RSA (www.rsa.com), EMC’s security division, which provides secure data, compliance, SIM, SEM, consumer identity, and access solutions to more than nine out of ten Fortune 500 companies. Symantec, however, may be able to leverage its size and existing relationships to quickly gain market share.
In a call with financial analysts and press, Symantec chief executive officer Enrique Salem said that Symantec’s acquisition of VeriSign’s security business underscores the company’s big plans for identity-based security.
“IT is faced with the challenge of giving people appropriate access while ensuring that corporate data is never at risk. We believe the solution to this dilemma lies in the universal adoption of identity-based security. Identity-based security provides the assurance that as information moves in and out of the cloud, across any device and between the network, it is always protected. The user’s identity drives what information they can access and how it can be used and shared, independent of the device or application.”
Sunit Gogia, who covers the software industry as a senior stock analyst for Morningstar, notes that he lacks optimism about the acquisition, however, by focusing on building a one-stop security vendor, it may strengthen its competitiveness and perhaps drive expansion of operating margins.
“We think Symantec could effectively combine VeriSign’s assets with its own server security software to provide identity and authentication solutions to corporate customers needing to authenticate remote access to corporate resources. EMC’s EMC RSA unit is the dominant player in this market, but Symantec’s enterprise security relationships could help it gain share rapidly. Identity management and authentication in the consumer market is trickier, and we don’t expect Symantec to succeed where others have failed. Website operators have little incentive to support Symantec’s authentication solutions until a majority of their customers are equipped with Symantec’s identity product. And consumers have little reason to purchase Symantec’s identity solutions until websites support their usage. Symantec could attempt creative partnerships to seed usage of its identity and authentication services, but we would bet against this catch-22 situation being resolved in Symantec’s favor.”
In a an interview with website net-security.org, Francis deSouza, senior vice president of Symantec’s enterprise security and compliance group, explains that synergies are already being identified as Symantec gains VeriSign’s useful resources.
“We will provide details on product roadmap after the close of the acquisition. However, in the future, we see the benefits of combining VeriSign’s SSL Certificate Services with Critical System Protection and Symantec Protection Suite for Servers. By bringing these offerings together Symantec will be positioned to help organizations both ensure a higher level of security on their web servers as well as verify that security, providing users with the trust and confidence necessary to do business online.”
deSouza went on to note that many of those who buy SSL certificates are also quite often users of Symantec’s critical protection products.
The acquisition seems like a reasonable enough investment in itself for Symantec, considering that VeriSign’s authentication services unit, which provides widely used encryption technology, generated $410 million in revenue last year. Still, there is much speculation about how (and how well) Symantec will incorporate VeriSign’s security technology, and when such a product will become available. The real challenge and reward will be in finding value in the synergies between Symantec and VeriSign.
No related posts.
