Security titans intensify rivalry

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June 16, 2004 (Network World) -- Network Associates Inc. and Symantec Corp. long to be more than antivirus vendors. The rivals want to be one-stop security shops where businesses buy everything from intrusion prevention to spam control to firewalls.
Each has invested a small fortune in pursuit of this goal, yet sweeping success is guaranteed for neither.
Since CEO John Thompson took the helm four years ago, Symantec has parlayed its strength selling consumer antivirus software into a string of acquisitions that began with firewall and vulnerability-assessment company Axent Technologies and continues most recently with the purchase of anti-spam market leader Brightmail Inc. (see story) .
Over that same period, Network Associates, which as early as next month will be renamed McAfee, its antivirus moniker, also spent hundreds of millions of dollars buying up companies: Trusted Information Systems (TIS), PGP, IntruVert and Entercept (see story). It also sold off its Sniffer protocol-analysis tools and Magic help desk units in what CEO George Samenuk says is a bid to focus solely on security.
However, becoming a full-service security company takes more than an acquisitive streak and deep pockets.
"We want to be more than just an antivirus company," says Allyson Seelinger, Symantec's vice president of global channels, sales and strategy. Symantec still struggles to dispel the notion that it's somehow not a full-fledged security vendor, she says.
Symantec's product line has grown beyond antivirus software. The company sells virtually everything through region-specific value-added resellers and systems integrators. But customers and sales channel partners still typecast Symantec as an antivirus vendor.
For Network Associates, which also will be reliant on sales channel partners after it sells Sniffer, the perception is not much different.
"In antivirus and understanding major exploits, they're good," says Rodney Madkins, security administrator at Arkansas Children's Hospital in Little Rock. "But I wouldn't necessarily think of Network Associates as a security vendor in a larger sense."
In areas such as vulnerability-assessment tools, firewalls and encryption, for example, Network Associates has no products. The company dropped these types of security wares after it bought companies that made them -- PGP for encryption products, TIS for its Gauntlet firewall -- but found it couldn't gain market share.
Nevertheless, antivirus software remains a cash cow for both companies.
Symantec posted record revenue of $1.8 billion for fiscal 2003, a 33% increase over the previous year, and net income of $371 million. Network Associates anticipates a revenue decline this year to about $800 million from last year's $933 million -- because of the sale of the Magic and Sniffer businesses, it says. The company last year posted earnings of $67 million; it hasn't released anticipated fiscal 2004 earnings.
For both

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