Symantec Data Encryption Security Strategy Stays the Course

Symantec CEO John Thompson said the company has no plans to get in the encryption business. Symantec will continue its OEM relationship with data encryption vendor GuardianEdge, even as security rivals McAfee and Sophos make acquisitions to bring endpoint encryption inhouse.

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Security giant Symantec has no plans to get into the encryption business, regardless of what competitors Sophos, McAfee and SafeBoot have done to acquire the technology themselves.

Symantec is committed to its OEM arrangement with GuardianEdge Technologies to provide the encryption technology customers require, despite moves by some of its rivals, Symantec CEO John Thompson said July 30 during a conference call to announce Symantec's earnings for the first quarter of fiscal 2009.

"We've been quite pleased with the relationship with GuardianEdge, obviously as the pipeline continues to build that represents a good opportunity for both of our companies," Thompson said. "We've made no decisions about changing that relationship or any other as it might add to purchase something in the encryption space."

Symantec has an OEM arrangement with GuardianEdge, which it leveraged to launch Symantec Endpoint Encryption 6.0 earlier this year. While the company remains committed to that arrangement, rival security vendors have been making moves to buy their way into the data protection space. Sophos announced plans July 28 to acquire German data security vendor Utimaco Safeware for its DLP (data loss prevention) and encryption portfolio. In addition to the play by Sophos, McAfee acquired SafeBoot last year for its encryption technology and has begun the process of integrating it in its product offerings.

When McAfee acquired SafeBoot, McAfee CEO Dave DeWalt stated his company's goal was to make McAfee the leader in endpoint security by baking SafeBoot's technology into the company's security risk management products. Sophos CEO Steve Munford's sentiments were similar. He called encryption an "anchor tenant" of information protection and added the acquisition of Utimaco could raise the company's position as a competitor to both Symantec and McAfee.

Is Encryption a Commodity? Maybe to John Thompson.

Some analysts agreed purchasing Utimaco would help Sophos as it seeks to play in the same yard as Symantec and McAfee. Paul Roberts, an analyst with The 451 Group, opined that Thompson is skeptical of encryption as a long-term play for Symantec.

"He sees it as a commodity technology that will, in the near future, be standard issue with drives from hardware vendors like Seagate, etc. or free as part of Windows and therefore of little value to software companies like Symantec," Roberts said.

Symantec's security business is doing well, posting 12 percent year-over-year growth in its security and compliance segment.

"Our Vontu team had the best quarter in their history," said Enrique Salem, Symantec chief operating officer, during the earnings call Wednesday. "During the quarter we closed our largest DLP deal ever and we won our largest international deal to date."