This seems like a very odd decision to me. Intel, a world leader in processor design, does not need to get into such a sleazy business as antivirus software.
Why not spend that $7.7 billion helping the world write better code?
Intel has a large interest in mobile, virtualisation and network arenas; this isn't really as surprising as you make out.
So! I'm officially bad luck with businesses (was around just as CompUSA got liquidated, now McAfee acquisition), anyone wanna hire an MIS major with a burning desire to learn stuff solely for the sake of learning?
But in all seriousness, I've been speculating over the reasoning behind Intel doing this, and haven't come to many conclusions. As some others here have stated, McAfee actually has quite comprehensive network security (I've obviously seen the network layouts / architectures), etc, and maybe Intel just wants to try and market that?
I have yet to come up with a good reason - they are pretty disparate companies from what I can tell. There are "some" common grounds, but not many.
McAfee also seems to be moving into different areas of computer security lately (PCI scans, etc), so it's not just anti-virus. I am not sure what % of their business this is though.
To most people, computer security is a mystery box inhabited by criminals who try and break in, and Mafia-like organizations who offer protection for a fee.
Right now, large companies have so much cash available to them, on such attractive terms, that acquisitions don't have to be a terribly good fit to be attractive. It's just time to buy.
Who wants to bet Goldman took a large, long McAfee position in the last couple of days? From an unrelated portion of the company, performing usual hedging activities, naturally :-)
And with Goldman under the regulatory microscope right now, I bet they are on the straight and narrow.
Their shareholders would have probably been better suited with a special $7B dividend instead.
I thought about my last post more, and I can think of a few applications where it could give Intel some huge advantages.
Something that came to mind: We all agree that AV software eats CPU cycles. What's to say Intel can't just start putting custom hardware that is designed solely to offload signature checking onto a separate chip? With the increasing sizes of detection databases (anomalies, threats, etc), eventually it will get to a point where the typical CPU cannot feasibly cross-reference known threats AND perform proactive checking in a fast enough environment to make it useful.
Not to mention network detection via the same means. Pretty soon you will be seeing motherboards or at least CPUs that have other dedicated hardware to checking signature sets on an extremely fast basis versus having to try and mix other, non-security-related cycles with what I'll call "user" cycles.
Seems investors think this is better for McAfee than Intel, too.
As for Intel going down, I would sell too. I don't really see how this deal makes sense.
* http://en.wikipedia.org/wiki/Trusted_Platform_Module
* http://www.intel.com/technology/anti-theft/
* http://en.wikipedia.org/wiki/NX_bit
and so on, of which Intel is currently involved with lots.
Security is what a desktop processor spends a lot of it's time doing: making sure programs are isolated from one another and the kernel whilst still executing code.
Intel want to put AV underneath the operating system (ie. under Windows), using their virtualization technology to make it invisible to the OS. This was one of the ideas behind their "failed" vPro project[1].
http://en.wikipedia.org/wiki/Intel_vPro#Security_and_Intel_v...
[1] Yes, I know vPro didn't "fail", but parts of it did, including an earlier attempt to shovel AV under the OS.
AV is snake oil. What do Intel have in mind?
Surely the issue isn't calling AV snake oil. Really. In this audience?
The fact that deals like this are happening means that the gloves are off and companies are not bunkering in anymore for a nuclear winter.
Also since this is just into 3rd qtr, this means that the company is not worried about 4qtr reports, this is clearly a sign of getting a head start on growth. I wonder how long the integration will take, 3 months would put in in 4qtr with something for Christmas?
What other software could Intel be looking at?
that's like trojan buying a porno studio, sure they're in a related field but where the heck is the synergy?
Now, how this is valued is something I still don't understand. Will this be another EBay-skype type of acquisition that'll end up break up again?
[1]: http://uk.finance.yahoo.com/news/intel-looks-to-secure-mcafe...
[2]: http://www.google.com/search?hl=en&tbs=cdr%3A1%2Ccd_min%...
Security is a nice subscription business to be in. The nature of security business is essentially a fight between the providers and the malware publishers. As the computing platform fragments again, you need to be a large company to comprehensively support multiple kinds of devices.
As we start to see more netbooks, slates, smartphones deployed across the enterprise, each device presents Intel another opportunity to make money on a chip it didn't have to manufacture.
I was hoping something like this would break through:
http://en.wikipedia.org/wiki/Capability-based_security
Not that I've bought any anti-virus stuff since we stopped using Microsoft. In fact, the anti-virus stuff was a good part of the decision to quit using microsoft completely. It turned perfectly good computers in to space heaters.
Also by acquiring a company with $2B revenues (and only $173M net profit) - they can do a lot of "creative accounting". The kind of large corporations usually do at the expense of shareholders and taxpayers...
Just Six Corporations Remain
http://www.theonion.com/articles/just-six-corporations-remai...
Struck me a bit like when Ebay bought Skype. I had to really strain my brain to come up with a way that deal made sense.
Of course, they could create and start to push some artificial, unnecessary security framework, but to whom? Some mobile Windows 7 on Atom I guess.. ^_^ which obviously a born-dead platform, same as this MeeGo.
