Paving the way for embedded devices to include more built-in security features, Intel announced it will acquire McAfee for $7.68 billion in cash. Separately, Odyssey Software and Wavelink Corporation both released upgrades to their management frameworks for mobile devices.

Intel says it will acquire fellow Santa Clara, Calif.-based company McAfee by purchasing all of the company's stock for $48 per share in cash, amounting to approximately $7.68 billion. As noted by The New York Times, this represents a 60 percent premium over McAfee's Wednesday closing stock price of $29.93 per share, suggesting there may have been a bidding war.

Paul Otellini, Intel president and CEO, stated, "In the past, energy-efficient performance and connectivity have defined computing requirements. Looking forward, security will join those as a third pillar of what people demand from all computing experiences."

"We believe that security will be most effective when enabled in hardware," Otellini was quoted by The New York Times as having added during a press conference. Intel will continue to work with other security vendors as well, he was further quoted as saying.

McAfee, which has enjoyed double-digit, year-over-year growth and nearly 80 percent gross margins last year, will become a wholly-owned subsidiary of Intel, reporting into the company's Software and Services Group. The group is managed by Renée James, Intel senior vice president and general manager of the group.

James stated, "Hardware-enhanced security will lead to breakthroughs in effectively countering the increasingly sophisticated threats of today and tomorrow. This acquisition is consistent with our software and services strategy to deliver an outstanding computing experience in fast-growing business areas, especially around the move to wireless mobility."

Based in Santa Clara and founded in 1987, McAfee has been the world's largest dedicated security technology company, with approximately $2 billion in revenue in 2009, according to Intel. The company offers a suite of software-related security solutions, including McAfee Total Protection, McAfee Antivirus, McAfee Internet Security, McAfee Firewall, and McAfee IPS, as well as an expanding line of products targeting smartphones and other mobile devices.

While Intel announced no specific plans for redeploying McAfee technology, the chipmaker strongly suggested it will build security into CPUs or other chips for embedded devices. In its statement announcing the acquisition, the company said:

Today's security approach does not fully address the billions of new Internet-ready devices connecting, including mobile and wireless devices, TVs, cars, medical devices and ATM machines, as well as the accompanying surge in cyber threats. Providing protection to a diverse online world requires a fundamentally new approach involving software, hardware and services.

Management frameworks get upgrades

While Intel moved forward on security, two vendors of MDM (mobile device management) products expanded their software frameworks to include additional smartphones. Odyssey Software says it is now shipping version 4.0 of Athena, providing MDM for Android, Apple's iPhone, the WebOS-based Palm Pre, Nokia's Symbian-based E and N series, and Windows Mobile and Windows Embedded CE devices. According to the company, Athena 4.0 works as part of Microsoft's System Center Configuration Manager management console, "leveraging the platform's inherent scalability, reliability, and security."

No mention was made of Windows Phone 7 (WP7), however. In a recent editorial criticizing the new operating system's business features, eWEEK's Andrew Garcia stated that WP7 will not support System Center, so solutions such as Athena "will need to start from scratch."

Meanwhile, Wavelink Corporation says it will extend "the next major release" of its Avalanche product to provide MDM for the Google-backed Android, the Apple iOS platform, and RIM's BlackBerry. The upgrade, for which a timetable was not given, extends Avalanche's existing support for Windows Mobile, Windows CE, and Palm OS devices.

Stacy Crook, senior research analyst with IDC's Mobile Enterprise research group, was quoted as saying, "With the continued proliferation of multiple device types into the enterprise landscape, many companies will find that choosing a mobile device management solution with cross-platform support is essential. Successful MDM companies will not only provide robust device management and security functions that can support broader sets of the wireless environment but will also enable device choice as well."

Further information

The story by The New York Times alluded to above may be found here. For details of McAfee's product line, see here.

More information about the Athena and Avalanche products may be found here and here, respectively.

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