Intel Sells Software Division

UpdateThe chip maker is selling off controlling interest in LANDesk to more aggressively pursue new opportunities in the management software space.

Intel Corp. is selling off controlling interest in LANDesk, its software division that develops applications to manage computer networks.

The software unit will be sold to LANDesk Acquisition Corp., an entity formed by two venture capital firms, Vector Capital of San Francisco and vSpring Capital of Salt Lake City, Intel said Wednesday.

Financial terms of the deal, which is expected to be completed by the end of the month, were not disclosed, but Intel said it will continue to hold a minority stake in the new company.

The move, part of Intels refocusing on its core business, is intended to allow the software organization to more aggressively pursue new opportunities in the management software space.

"I think its the right thing for them to do," reacted Ronni Colville, research director for Gartner Inc. in Stamford, Conn. "As a chip manufacturer, they dont have as much of a compelling story to be a software distribution solution provider as a Novell or a Microsoft," she added.

The 150 workers currently employed by Intel, in Santa Clara, Calif., will be offered the opportunity to continue working on LANDesk at the companys new headquarters, which will be based in Salt Lake City and headed by new CEO Joe Wang, former head of Symantecs enterprise software division.

"This is not Intel getting out of the business, but rather setting it up to be more successful," declared Robert Naegle, director of market development for Intel in Salt Lake City. "Its been profitable, but its getting good financial backing to allow it to grow more aggressively. The business doesnt change," he asserted.

"In the past where Intel took profit out of the business, well reinvest it back in and market it more aggressively," echoed Wang in Portland, Ore. "Youll see more frequent new releases and well get into new areas," he added.

Although the LANdesk desktop management suite has been around for several years, Wang doesnt characterize it as a mature product line. "There are a lot of things we could do that were not doing. Our focus will be in mid-sized companies with 500 to 5000 users. There arent a lot of tools available in the market to serve those (companies) well," said Wang, who also sees the international market as an "untapped" area.