Symantec, Veritas Merger Signifies Major Shift

If the merger between the security and storage giants is completed, analysts say it could be proof that users want security and storage to come together.

The rumored merger of storage software giant Veritas Software Corp. and information security behemoth Symantec Corp. may be a sign of things to come.

According to various reports, Symantec, of Cupertino, Calif., is angling to buy Mountain View, Calif.-based Veritas—which offers software for backup and archiving, file systems, storage and server automation, and application service management—for more than $13 billion.

/zimages/2/28571.gifRead more here about talks between Symantec and Veritas.

If completed, the merger of the two companies may be the proof the industry needs that storage and information security themselves are merging, said Steve Duplessie, senior analyst at Enterprise Strategy Group of Milford, Mass.

"It proves what we and users have been saying for a while—you cant continue to disassociate security from data," he said. "Security has typically been perimeter-based, but all of the crown jewels are spinning around on disk drives, and it was inevitable that these two things come together."

Over time, the combined company could begin providing what the industry needs in terms of security-infused storage products, he said.

"Youll see complete integration of things, like a security event triggering an automated backup, that ultimately have to happen," said Duplessie. "And Id be surprised if you didnt start to see Veritas starting to encrypt data everywhere."

The move makes sense for both companies, experts said. Symantec has long tried to begin applying security principles to storage, first by attempting to buy VMware (eventually purchased by EMC Corp.) and then following through with the purchase of PowerQuest. The purchase of Veritas, which was a stockholder of VMware, would further that goal.

Veritas has made itself a particularly attractive target through its rash of acquisitions over the past few years with application-level agents and network reporting technology, said Jay Kidd, chief technology officer of Brocade Communications Systems Inc., of San Jose, Calif.

"It has moved from being at the layer of the enterprise value stack, which is totally focused on storage, up into more application and server administration," he said. "If Symantec was looking to move up into the enterprise, Veritas put itself right in Symantecs path."

In addition, the companys stock is at a relatively inexpensive level, making the timing good for both Veritas and Symantec, Duplessie said.

Next Page: Veritas motivation.