Will Microsofts Spyware Buy Cast a Giant Shadow?

Analysts predict that Microsoft will start a price war by introducing an enterprise-class product that fights both spyware and viruses. But will customers buy a security product to protect software sold by the same company?

Microsofts sudden acquisition of highly rated anti-spyware startup Giant Company Software has set the cat among the pigeons.

As competitors rush to spin the news as a "validation" of the nascent anti-spyware sector, analysts predict that Redmond is working on an enterprise-class product combining spyware- and virus-fighting capabilities.

"We believe Microsoft will come out with an anti-virus product with embedded spyware protection and theyll start a price war in the enterprise space," said Gartner security analyst John Pescatore.

/zimages/1/28571.gifRead more here about Microsofts acquisition of Giant Company Software.

In an interview with eWEEK.com, Pescatore speculated that Microsoft will launch a combined offering that marries Giants anti-spyware application to the anti-virus tools acquired in 2003 from Romanias GeCAD Software Srl.

At the time of the GeCAD acquisition, Microsoft made splashy headlines with plans to offer a standalone anti-virus tool for Windows users, but more than a year later, the company is still pointing customers to third-party offerings.

Amy Carroll, director of product management in Microsofts Security Business Technology Unit, declined to discuss long-term strategies. She said the immediate plans call for a beta of a standalone anti-spyware application for Windows 2000 and later versions.

During the beta, the application will be free, but there are hints that Microsoft will charge a fee for a final version. "We do not have a final plan for the final version. Well use the beta process to figure out the right business model," Carroll said.

"It will be a client-side offering for individual machines. We will be encouraging all our customers to use that, whether inside a business or in a consumer setting," Carroll told eWEEK.com.

Microsoft will continue to support Giant anti-spyware customers through the term of their existing contracts. Two other Giant products—Spam Inspector and Popup Inspector—will be discontinued.

Next Page: Microsoft says theres "no timeline" on an anti-virus product.