Gartner's take on Symantec's spending spree

[InfoSec News <isn () c4i org>]

http://www4.gartner.com/DisplayDocument?doc_cd=108426

Symantec Bolsters Security Offerings With More Acquisitions 

19 July 2002 
Richard Stiennon   
Matthew Easley   
Kelly Kavanagh   
John Pescatore 

Symantec bought four security companies, three of which may spur 
worries about product independence. Although the deals may trigger 
more merger and acquisition activity, Gartner sees no significant 
market shift.

   
Event 

On 17 July 2002, Symantec announced it acquired three companies - 
Recourse Technologies, Riptech and SecurityFocus - for a total of 
approximately $355 million in cash. On 2 July 2002, Symantec also 
bought Mountain Wave for $20 million in cash.
 
   
First Take 

A slump in venture valuations is a timely opportunity for an industry
leader, such as Symantec, to snap up good technology. The acquired
companies will gain from access to Symantec's capital, development
capabilities, sales channels and the power of its brand. Although
Symantec gains by bolstering its roster of products and services, it
still needs to convince enterprises that Riptech, Security Focus and
Mountain Wave will not be driven by Symantec's product line.

Riptech was a leader in the North American managed service security
provider (MSSP) market (see "2H01 Managed Security Service Provider
Magic Quadrant," M-15-2949). With secure-operations-center assets it
picked up from its acquisition of Axent in 2000, Gartner believes that
Symantec's combined MSSP business will represent one of the largest in
North America. Riptech customers should expect continued high levels
of service. Symantec's challenge is to avoid channel conflict that
arises from being a firewall, intrusion detection system (IDS),
antivirus and (with Mountain Wave) monitoring software vendor while
trying to maintain a service arm that is product-independent.

Recourse Technologies has useful tools - its ManTrap "honeypot" (a 
decoy system to lure and learn from attackers) and ManHunt high-speed 
IDS appliance, which fills a hole in Symantec's product line. However, 
Symantec must develop an enterprise sales story for network IDS at a 
time when the overall IDS market is heading toward replacement by 
intrusion prevention techniques.

SecurityFocus is a leading source of independent security information 
on the Web. Security intelligence is a core competency, and one 
Gartner believes Symantec should lead in, but it will never be a 
high-revenue market. Symantec gains by acquiring solid intellectual 
property and a fit with its antivirus labs. But the challenge is to 
maintain SecurityFocus as an independent, journalistic source for data 
on all security products.

Gartner advises enterprises to purchase best-of-breed security 
products that deliver the best return on investments, meaning better 
security. Although consolidation will likely continue in the security 
market, and other security companies will be compelled to shadow 
Symantec's moves, Gartner doesn't believe that there are any new 
reasons to adopt a one-stop-shopping approach for security offerings.

Analytical Sources: Richard Stiennon, Matt Easley, Kelly Kavanagh and 
John Pescatore, Gartner Research

Recommended Reading and Related Research

* "Symantec Must Resolve Overlaps After Buying Mountain Wave" 
  (FT-173343). Symantec must rationalize its firewall and IDS product 
  line and move toward intrusion protection. By John Pescatore, Matt 
  Easley and Richard Stiennon 

* "Enterprise IT Security Management Defined" (DF-15-7763). Gartner's   
  model helps enterprises evaluate security management software and 
  services. By Mark Nicolett, John Pescatore, Matt Easley, Alain Dang 
  Van Mien and Richard Stiennon 
 


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