Intel Buys McAfee: 10 Possible Outcomes

By Don Reisinger  |  Posted 2010-08-19

Intel Buys McAfee: 10 Possible Outcomes

In stunning news on Aug. 19, chip-maker Intel announced that it will acquire security-firm McAfee in a $7.68 billion deal. Much of the talk surrounding the announcement revolves around what Intel plans to do with McAfee. At this point, it hasn't had much to say. 

But once the deal closes and Intel finally has the ability to do what it wants with McAfee, the tech industry will find out if the move was a good one. And considering there are so many possibilities that could come out of this acquisition, it's tough to predict exactly what will happen. 

But that doesn't mean that Silicon Valley watchers shouldn't offer their own prognostications. There is a lot riding on Intel's acquisition of McAfee. And from an industry-wide perspective, it could have far-reaching effects. 

Let's take a look at some of the major developments that could result from Intel's McAfee acquisition. 

1. Symantec runs into trouble 

Symantec currently dominates the paid security-software market, easily besting McAfee on just about every front. But with Intel's backing, McAfee might have a change of fortune. Symantec doesn't have the bankroll that Intel enjoys, and thanks to the added talent that Intel can bring to the table, it's entirely possible that McAfee offers vastly improved services in the coming years. That, in turn, could have a direct impact on Symantec's business. The security company should be watching this acquisition closely. 

2. Intel makes a mistake 

Although most at Intel seem excited about the McAfee acquisition, it's entirely possible that the firm has made a mistake. McAfee isn't as big or as powerful as Symantec. And some would agree that its software doesn't work as well as some other options on the market. If that continues, and Intel can't get what it wants out of the company, it's entirely possible that this acquisition will be viewed as a blunder. 

3. Little changes at McAfee 

So far, Intel hasn't made its full intentions known about how it will handle McAfee. But that doesn't mean that Intel will vastly change the way the company operates. In fact, it's entirely possible that it will allow McAfee to operate as it currently does and only use it when it needs it. At this point, it's unknown how Intel will handle McAfee, but it's not a stretch to say little might change at the security firm. 

4. Better mobile security? 

It seems that Intel is deeply concerned with getting better security solutions on Web-connected devices, like smartphones. Based on that, the market might soon see some new mobile-security solutions coming from the Intel-owned McAfee to capitalize on that burgeoning market. Mobile security is becoming increasingly important in today's workplace. And that might only help Intel and McAfee going forward. 

How Long Will Intel's Acquisition Binge Continue?


5. McAfee goes away 

Just as likely as it is that Intel does little with McAfee, the company might decide to absorb the security firm altogether. For now, it's saying that McAfee will remain a separate entity, but as past technology acquisitions have shown, that's not always the case. Depending on Intel's goals and how it plans to accomplish them, the chip maker might decide to simply pick the aspects of McAfee's business that it cares about, and let the others die. All the while, the McAfee name could go the way of the Dodo. 

6. Intel slows down its acquisition craze 

As Intel noted in the press release detailing its McAfee purchase, it has been on an acquisition spree as of late. In fact, the company said that it has recently acquired companies in several different markets, including "gaming, visual computing, embedded device and machine software, and now security." Considering how much it paid for McAfee, look for Intel to slow down its acquisitions. 

7. Uncertainty in the desktop-security market 

The desktop-security market is still the foundation of McAfee's operation. But with Intel now taking the lead, it's possible that consumers and enterprise customers will be loath to acquire new McAfee software until they know that the security firm is fully invested in that space. Prior to the acquisition, McAfee had stated goals. Now, Intel has different goals. That could have a direct impact on desktop security. And given how important it is for consumers and especially enterprise customers to safeguard data, it could be enough to send some customers elsewhere. 

8. Intel loses its way 

With Intel acquiring McAfee, some might already be wondering what the company was thinking about. After all, it makes processors and now, it's trying to get into the security business. Depending on how Intel manages McAfee, the company might lose its way. It might get caught up in security to the detriment of its chip operation. It might also get distracted by the many other firms it acquired. Intel is big and it's successful, but that doesn't mean a major acquisition can't derail its vision. 

9. AMD buys a security company 

Although the focus of the McAfee acquisition revolves around Intel's vision, it's important to not forget that AMD is still a major player in the chip market. And due to Intel's acquisition of McAfee, it's possible that AMD will follow suit and acquire a security firm of its own. Given its recent financial woes, it likely won't be able to afford a major firm such as Symantec, but it's possible that it picks up a smaller company. Intel's McAfee acquisition puts AMD on notice: the future is in security. 

10. Consolidation in the security market 

If (or perhaps, when) AMD acquires a security firm, look for smaller companies to start banding together. In some markets, when a major acquisition is made and a huge firm looms, smaller companies attempt to bolster their services by buying other, even smaller companies. That doesn't necessarily mean that the security market will consolidate, but that possibility seems more likely than ever. In a few years, it's possible that just a handful of paid services will be available to combat the world's security threats. And the market will have Intel to blame for it. 

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