WASHINGTON—This year has been nothing if not eventful for Network Associates Inc. The first five months of 2003 have seen the Santa Clara, Calif., security vendor restate several years of earnings due to an accounting issue, endure investigations by both the Department of Justice and Securities and Exchange Commission and acquire two up-and-coming intrusion prevention vendors. Most recently, NAI went through a round of layoffs as it continues to try and refocus its product lines. Senior Editor Dennis Fisher sat down with Gene Hodges, president of NAI, Sandra England, executive vice president of corporate development and strategic research and Robin Matlock, vice president of product marketing at McAfee Security, to discuss the recent purchases of IntruVert Networks Inc. and Entercept Security Technologies as well as the companys future product plans and strategy.
eWEEK:: How is the integration of the new acquisitions progressing?
England: Our initial focus has been integrating Entercept into McAfee because there are a lot of synergies with the technologies with the signature-based and behavior-based approaches. Were developing some integrated product plans, too.
Hodges: The big challenge is, this isnt just two new product lines; its the future of the company. IntruVert and Entercept took over Network Associates in a way. You know, you get used to doing anti-virus with some network management and then something like this comes along and it changes the landscape.
eWEEK:: Do you expect it to be easier for you to get these products in front of buyers than it was for Entercept and IntruVert?
England: Yes. We have a great footprint in the marketplace, whereas a small company would have a harder time doing that.
Hodges: Both companies have a lot of traction. My experience is that customers are very eager to deploy intrusion prevention but the question is, does it work?
eWEEK:: The acquisitions had a big effect on market. Who do you see as your main competitors now?
Matlock: In a lot of ways, it changed the marketplace. There are still a lot of smaller niche players, though.
England: It changed the landscape pretty dramatically. I think the big players will be Cisco and us.
eWEEK:: What kind of integrated products are you working on?
England: The first integration will be bringing together Entercept and McAfee, integrating the behavior-based blocking with the signature technology of the anti-virus. Were in a unique position to leverage anti-virus and intrusion prevention at the host. The product teams are working fast furious on that right now.
Hodges: We want to move Entercept to the desktop rapidly. There will also be some IntruVert and Sniffer integration soon. In a very real way, the people who man network intrusion prevention devices are the same people who manage Sniffer devices. And most security teams are in a fight for control with the operations people.
eWEEK:: You mentioned Cisco earlier as tough competition. Do you think Symantec will be a competitor in this market?
England: We see Cisco as a very strong and competent competitor. Symantec was correct to make the acquisitions they did, but the problem is they bought the wrong companies. They dont have the best technology.
Matlock: If you look at the players who really have the pillars we have, no one else really has that mix of technology that we have.
England: Our vision is to be the best of breed provider, because thats still what enterprises are buying.
eWEEK:: Do you have any plans at this point to get into the managed services business?
Hodges: Well be an arms broker to the warring armies. How about that? We dont plan to get into managed services at this point. Well sell them all anything they want. Were going to take a different path than Symantec and ISS at this point.
England: The economics of that model are just so different from what a software company usually deals with.
eWEEK:: I know you cant comment specifically, but do you have any plans for more acquisitions?
England: I think the security space is still ripe for consolidation whether were the ones doing it or not. There are too many companies with great technology. We continue to look across the landscape to see whats out there, but were focusing on getting these two under our belts first. If we make an acquisition, you can rest assured it will be the best technology. Thats what our customers demand.
Hodges: The focus of our other acquisitions would be to reinforce our intrusion prevention technology. If we can block 70 or 80 percent of attacks, then customers can focus on the few that get through.