TELECOM Digest OnLine - Sorted: Mcafee Buys WiFi Firm Wireless Security Corp.

Mcafee Buys WiFi Firm Wireless Security Corp.

Lisa Minter (
Thu, 2 Jun 2005 14:25:53 -0500

By Spencer Swartz

SAN FRANCISCO (Reuters) - McAfee Inc., the world's second-biggest
maker of security software that protects personal computers from
Internet viruses, on Thursday said it has bought software maker
Wireless Security Corp. and continues to look for other acquisitions.

McAfee did not disclose how much it paid for Wireless Security, which
gives McAfee its first foothold in securing popular short-range WiFi
networks used by consumers and business travelers in airports and
coffee shops.

McAfee bought all the outstanding stock, technologies and assets of
Palo Alto, California-based Wireless Security Corp., with which McAfee
already has a partnership. McAfee's stock traded down about 1 percent
in New York.

George Samenuk, McAfee chairman and chief executive officer, told analysts
and investors in New York that McAfee, which has about $1 billion in cash,
continues to search for acquisitions of both publicly traded and privately
held companies.

"We're looking at both .... We met for several hours last night (to talk
about) what other directions we should go down," he said.

Samenuk said consolidation in the security software industry would
continue and said there was still "tremendous opportunity" from
customers looking to buy products to secure their networks from
Internet menaces like spyware, which can secretly monitor a computer
user's activity.


The U.S. House of Representatives in late May voted to establish new
penalties for purveyors of spyware.

Samenuk also said it is "staggering" how many calls McAfee gets from
privately held firms about wanting to sell themselves.

Investors in these companies are coming to realize they should sell
the firms now due to unpromising future growth prospects, Samenuk

Many analysts have expected consolidation as companies opt to buy
security products from fewer vendors to lower costs and the complexity
of integrating the products they buy.

All of Wireless Security's software developers will join McAfee, said
McAfee executive vice president Bill Kerrigan. He declined in an
interview to say how many employees Wireless Security has.

Kerrigan said he did not expect McAfee, based in Santa Clara,
California, to make other acquisitions in the WiFi security area in

WiFi connections have grown increasingly popular in recent years,
especially among business travelers who use the networks to connect to
the Internet and into their company's internal networks.

But such connections have also become more prone to hackers trying to
intercept personal information, like passwords and credit card data,
over the wireless signals.

Products from the acquisition will include a downloadable offering for
consumers and a version for small businesses that will be part of a
bigger suite of several computer security products McAfee offers,
Kerrigan said.

Copyright 2005 Reuters Limited.

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