October 26, 2006 - #143
Good Morning:
Overcast Thursday. Not as overcast as in St. Louis, where it's not clear they are ever going to finish the World Series, but overcast nonetheless. Makes me want to go back to sleep. But there are presentations to finish, blog posts to catch up on, customer deliverables to get done, and world domination to plot. So there will be no sleep til Brooklyn [1] at Incite Central.
In security-land, we have earnings and deals aplenty. Symantec, SonicWall and SafeNet all announced yesterday and the news was mostly good (here [1]). Symantec didn't beat the numbers by enough, so their stock will suffer a bit. But it seems they are executing better (they couldn't execute much worse), and the scale and leverage of their business is becoming apparent. Vasco is no longer "the authentication company" since they now have a UTM platform after buying a few Belgian guys, a coffee maker, some Aeron chairs and a UTM product for $6 million (here [1]).
I'd also be remiss in not pointing out another technology that is now pervasive enough to cease being a differentiator (here [1]). Pretty much every email security vendor has a reputation service now and since many of these players also have other perimeter devices, you are seeing reputation bleed into all sorts of security technologies. It was a novel idea back in 2004, but not so much now. At this point, customers will be asking why you DON'T have reputation, if you haven't done the obligatory reputation press release.
In blog-land, I need to swim upstream a bit about the Counterpane/BT deal (here [1]). I don't think it was a "fire sale." How is 2x revenues for a slow growth services company a "fire sale?" For a product company, yes - 2x sales is a bad deal, but not for services. The economics are just different. I also delve a little into taking positions on incomplete data (here [1]), since the Mogull got taken to task for making a statement about the number of zero day attacks. There are people that are comfortable taking positions based upon a few data points, a dose of gut feel, and a ton of experience. There are also people that are not. The latter camp shouldn't become analysts because you'll never have enough data to meet a customer's timeframe. By the time you do, the decision is in the rear view mirror.
Have a great day.
Technorati: Information Security [2]
Top Security News
here [3]), SonicWall (here [4]), SafeNet (here [5])
Link to this [5]
here [6]), Vasco has acquired a Belgian UTM software company called Able, NV. Right, I've never heard of them either. But they are Belgian, so the Vasco folks a minimizing relo for the personnel. Reality is, if you aren't buying installed base, you may as well just get some technology and not pay a lot for it. Vasco paid about $6 million for the company and they did about $1 million in revenues. The real question is whether Vasco's channels will know what to do with a UTM product. Authentication and perimeter defense are related (typically the authentication product must interoperate with the firewall/VPN), but usually bought at different times by the customers. Secure Computing is the only other player in authentication to also have a UTM platform, so we'll see how that works out. It's also interesting to see Vasco move in the direction of more traditional security, as opposed to acquiring something more established in the next gen authentication space. I'm a fan of focus, so I'm not sure this deal makes sense to me, especially since Vasco's tag line is "the authentication company."
http://www.vasco.com/about/press/fullstory.html?press=449 [7]
Link to this [7]
http://www.fool.com/news/commentary/2006/commentary06102503.htm
[8]Link to this [8]
http://www.commtouch.com/Site/News_Events/pr_content.asp?news_id=773&cat_id=1 [9]
Link to this [9]
http://searchsecuritychannel.techtarget.com/tip/0,289483,sid97_gci1220368,00.html [10]
Link to this [10]
Top Blog Postings
http://anti-virus-rants.blogspot.com/2006/10/myth-of-avs-failure.html
[11]Link to this [11]
here [12]). Anything at a "fair" valuation has got to be a fire-sale because many security start-ups are banking on getting 6-8x revenues. It's bad to see companies like Preventsys and Counterpane go for much less because it hurts valuations across the board. Just call me Columbo...
http://episteme.ca/cblog/index.php?/archives/79-Counterpane-Fire-Sale.html
[13]Link to this [13]
http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=9004387
[14]Link to this [14]
http://securosis.com/2006/10/25/how-i-know-there-are-very-few-true-or-less-than-zero-day-exploits/
[15]Link to this [15]