Deal: VeriSign acquires SnapCentric

It seems all the big security vendors have their check books out and they aren't afraid to use them. The pace of M&A continues to accelerate and for good reason. Niche security is out, "security solutions architectures" are in.

So vendors need to get big or get out. Big is the new small. This will continue to drive consolidation this year and into next. The latest deal (there were 3 announced last week alone) is VeriSign buying Snapcentric, to add some fraud identification technology to their line of authentication solutions.

Strong authentication is a critical part of identity management. The upcoming "Battle Plan" on Identity Management will discuss this in much more detail, but suffice it to say having a built out identity management infrastructure is fairly useless if you don't know who is trying to get in.

For the first time RSA is facing legitimate competition in the enterprise token space. VeriSign has the reach and brand to challenge. In terms of where authentication is going, clearly the need to get smarter and do the "right" amount of authentication depending on what needs to be done. This kind of "contextual authentication" is critical, especially for financial institutions. If someone is transferring a million bucks, you probably want a few more authentication hoops to be required. That is what drove RSA to buy Cyota at the end of last year.

Adding value on top of the commodity token drove VeriSign to acquire Snapcentric. Paying about $12 million for the company, clearly RSA's Cyota is much further along in establishing that beach head in the banks. Yes, I understand Cyota and Snapcentric do somewhat different things, but that's not the point. It's about adding value on top of strong authentication, and that is what both deals were about. Suffice it to say that VeriSign is now going after their genetic ancestry, using the very network RSA had a big hand in building. Remember, it was RSA's technology that was the foundation for VeriSign.

It should be fun to watch these two slug it out. Customers will get better pricing, safer transactions and more innovation. That's the way competition is supposed to work.