7 ms·
Intel to buy McAfee for $7.7 Billion
- pvdm 16y agoLost all remaining respect for Intel with this bone-headed move. McAfee and Intel headquarters are within walking distance of each other. Perhaps the CEOs met for a few drinks at Birks and decided to do this. Make absolutely no sense at all.
- cryptoz 16y agoWhy would they do this? It seemed obvious to me than in 5-10 years Antivirus software would be obsolete and unnecessary. I hear people every day recommending Windows 7 users get Microsoft Security Essentials and nothing else. And personally I run Ubuntu, so I haven't thought about antivirus software in years... 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?
- tzs 16y agoI work at a small antivirus company. I'd be interested in knowing how helping people whose computers are infected get them uninfected is a "sleazy business".
- hga 16y agoLast week I spent two solid days rebuilding from scratch my mom's PC from it's OEM Windows XP Home installation after some hostage type malware managed to defeat it's not quite state of the art defenses (e.g. AVG). You aren't doing anything sleazy at all assuming your stuff is really good (that includes your not working for AVG :-).
- panacea 16y agoYou're probably encountering one of those hard to shake off guilt-by-association theories, and working in the field, I'd be surprised if you are genuinely unaware of it. 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.
- deleted 16y ago[deleted]
- javery 16y agoMy guess is that they will be able to use their existing OEM relationships to push for McAfee to be installed by default (and paid for, not just a trial) on more and more computers. 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.
- Tichy 16y agoI thought unwanted default installs are the only way McAfee ends up on computers anyway.
- buro9 16y agoIf that's what it's called when network admins put on their default build images, then yes.
- GFischer 16y agoAnd corporate sales (writing this from a corporate PC with McAfee installed). At least it's not obnoxious.
- easyfrag 16y agobut it does bring a machine to its knees compared to the Microsoft Security Essentials product
- dododo 16y agoMcAfee do more than just desktop antivirus: for example, they have mobile, virtualisation and network security products. see products by category here: http://www.mcafee.com/uk/enterprise/index.html http://www.mcafee.com/uk/enterprise/index.html Intel has a large interest in mobile, virtualisation and network arenas; this isn't really as surprising as you make out.
- jakevoytko 16y agoMcAfee also has strong UI programming expertise that Intel sorely needed. Intel's IPP and MKL libraries are absolutely great, but VTune looks like it is fresh out of 2002. They get access to several stable revenue streams (like antivirus), and can cherry-pick talent to work on whatever projects they want. There aren't many downsides for Intel.
- BrandonM 16y agoWe're talking about $7.7 billion. I'm not sure it's quite as rosy a picture as you paint. I'm not that familiar with McAfee's annual profits, but even if they make $500 million a year, we can value the talent they cherry-pick at an absurdly high value of $1 billion, and it would still take Intel well over 10 years to recoup the investment, assuming stable revenue streams.
- reitzensteinm 16y ago$173 million in 2009, up from $172 in 2008 and $166 in 2007. It seems odd to make an assumption when the real answer is seconds away!
- BrandonM 16y agoThanks, I was about to head into a meeting and didn't have time to do the research. Assuming $175 million in profits per year, that means 44 years to breakeven, ignoring the talent acquisition angle. How much are 20 (or even 50) good programmers worth?
- 16y ago
- mcknz 16y agoIntel decided to do a public good, and plans to remove all McAfee antivirus software from the planet.
- shadowfox 16y agoIs McAfee really that bad?
- loupgarou21 16y agoAfter buying Secure Computing and then discontinuing the SnapGear I know I'm not terribly happy with them.
- ajju 16y agoSnap Gear was awesome. Used an SG565 for some research we were doing. Best wireless router/UTM I have ever owned. Disclosure: Used to work for Secure Computing, but not the snapgear division.
- mcknz 16y agoIn April they issued an update that accidentally targeted legitimate Windows system files, causing the updated boxes to bluescreen. Astounding enterprise-level incompetence.
- Marticus 16y agoWell what worries me is mostly "what's going to happen to my job now?" I'm not some higher-up so... outlook isn't great. I've seen enough mergers to know how that usually goes. 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.
- instcode 16y agoIs McAfee really worthier than Sun? If IBM took a deal with Sun at that high, the Sun would have moved around the earth and Oracle doesn't stand a chance to slur the OS community!
- protomyth 16y agoGoogle != OS community
- xpaulbettsx 16y agoI'm definitely biased as a MS employee, but I can't underscore enough MSE as an Antivirus solution - it's the least annoying AV on the market and has the least perf impact on your system. Literally, you install it and it only bothers you when it absolutely has to.
- OmarIsmail 16y ago100% agreed. I don't work for MS but I honestly didn't run av software at all until MSE. It's the Google Chrome of AV software.
- sahaj 16y agocan you convince my workplace to dump Symantec and start using MSE?
- wazoox 16y agoProbably not; sane people dropped Symantec around the time when norton 2000 came out.
- deleted 16y ago[deleted]
- shajith 16y agoMaybe McAfee has a patent portfolio that Intel fancies some use for?
- robg 16y agoCan anyone tell me why? It seems like a poor fit.
- nkassis 16y agoI agree. I can see them moving to secure computers at the hardware level but does Mcafee even do this at the moment?
- konad 16y agoAV eats CPU cycles, Intel sells CPU cycles. That do ?
- paraschopra 16y agoLots of stuff eats CPU cycles, Intel surely cannot acquire all of it.
- lallysingh 16y agoHow many other products make everything else on the computer substantially slower?
- adamhowell 16y agoWindows?
- Poiesis 16y agoDisk encryption.
- deleted 16y ago[deleted]
- gaius 16y agoIt eats more I/O.
- shrikant 16y ago
- mnemonicsloth 16y ago...for a 60% price premium. 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.
- sabat 16y agoAnd it's not like they're motivated to start hiring or anything.
- eru 16y agoHow about paying dividends?
- d2viant 16y agoOr buying back shares.
- _delirium 16y agoI think there's a bit of an agency problem on that one. Paying large dividends to return cash is sometimes a good choice for investors, but some executives, especially in tech, see it as some kind of failure: you're doing the opposite of an IPO, giving money back because you admit you don't know what to do with it! A bold new move is more interesting from an empire-building point of view.
- rphlx 16y ago
- Maven911 16y agotalk about being overpriced... i guess the bankers knew how to negotiate
- larsberg 16y ago"advised by Goldman Sachs" 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 :-)
- blantonl 16y agoYou might want to brush up on the Glass-Steagall Act, which expressly prohibits these types of activities within organizations. i.e. ... "The Wall" And with Goldman under the regulatory microscope right now, I bet they are on the straight and narrow.
- jbooth 16y agoThe glass-steagall act which was repealed in the late 90s and which many people point to as the key piece of deregulation that kicked off the housing bubble?
- yeahright09 16y agoYeah, they are definitely on the straight and narrow, I will tell you that much. And that is the reason we know that our regulatory system is beyond broken. Goldman probably put up the loan for the deal and maneuvered it all into place, because naturally their advisory services are in synergy with their other products.
- blantonl 16y agocynicism these days seems to not be recognized.
- ajju 16y agoDave DeWalt, McAfee's CEO is an excellent salesman.
- pointillistic 16y agoCould you please tell me if technically you can have security hardware based? Apple now competes with Intel, even in hardware. Would it make sense for Intel to have a "more secure" processors?
- dododo 16y agothere's already a lot of hardware-based "security" out there. for example: * http://en.wikipedia.org/wiki/Trusted_Platform_Module http://en.wikipedia.org/wiki/Trusted_Platform_Module * http://www.intel.com/technology/anti-theft/ http://www.intel.com/technology/anti-theft/ * http://en.wikipedia.org/wiki/NX_bit 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.
- rwmj 16y agovPro as well, which I strongly suspect is what this is about. 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_vPro_PCs 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.
- pcestrada 16y agoMaybe Intel hopes to extend their 'Intel Inside' campaign to include anti-virus protection?
- eru 16y agoDidn't they stop that campaign years ago?
- dreaming 16y agoFirst thought: overpriced
- clofresh 16y agoMaybe we can get hardware-level virus checking instructions so that scans don't take so freakin' long.
- loewenskind 16y agoGood lord, please no! We need to make viruses so slow and painful that every OS designer must make their OS resilient to them. This is a stupid problem to have at all, the last thing we want is to bake in into the bloody hardware!
- sabat 16y agoThe Onion had this strangely prophetic article about 10 years ago: Just Six Corporations Remain http://www.theonion.com/articles/just-six-corporations-remain,551/ http://www.theonion.com/articles/just-six-corporations-remai...
- Groxx 16y agoHeard via NPR this morning: Intel stocks are down a few %, while McAfee is up over 50%. Seems investors think this is better for McAfee than Intel, too.
- mcknz 16y agoPretty typical for an acquisition -- the stock price of the company to be acquired will rise quickly to the price per share the buyer offers.
- secret 16y agoIntel offered 60% more than McAfee was worth yesterday. Basically if you buy MFE now (up 57% as I write), you're essentially just buying a bond with a 3% return between now and when the stock switches to Intel. Of course, there's always a chance the deal isn't completed for whatever reason. As for Intel going down, I would sell too. I don't really see how this deal makes sense.
- afterburner 16y agoThe purchaser's stock typically goes down because the company just spent a lot of money... whether loaned or not.
- secret 16y agoVery true. My point was that this just seems like a bad idea to me, and it would scare me from holding the stock if management keeps making deals like this.
- jakarta 16y agoI think this is indicative of a real risk we will see with large corporations right now. Many of these large cap companies have huge cash hordes and are being pressured to do something with it. The risk is that the cash will be used stupidly to do poor deals and I think the market is indicating that this McAfee deal is a bad one. Their shareholders would have probably been better suited with a special $7B dividend instead.
- Marticus 16y agoNot necessarily - I think it has the potential to be a very good move for Intel. 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.
- InclinedPlane 16y agoNo thank you! AV software is not security, it's a stopgap measure for when you have to "do something" but are too lazy to implement real security measures. And McAfee is one of the lowest quality AV vendors out there (remember when they pushed out a definition update that made XP instances unbootable? that costs a lot of people a lot of headache, and millions of dollars).
- Marticus 16y agoIt isn't software at that point as you would normally think of it - it would be a dedicated hardware piece that simply cross-references signatures with a known detection library and reports to the Intel chip. And you think end users have any grasp of how to implement "real" security measures? Oh hell no. Joe Schmoe at XYZ web design corp is inevitably gonna download that porn at work and get some worm.
- jdavid 16y agoIf Intel bought this in CASH, that would be silly, most likely they took our a low interest rate loan and used the cash to back it. 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?
- c00p3r 16y agoSeems like a management misunderstanding, or they really believe in a long life of MS. Even their own MeeGo (which is just a bunch or rpms) doesn't require any proprietary security solution, leave alone Android. 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.
- deleted 16y ago[deleted]
- omouse 16y agoThis makes perfect sense and will further drive us to buy more and "better" hardware. The software will slow down the comp so much so that you'll want to continually buy new hardware in the hopes of making things run faster! Intel is an evil genius.
- yuxt 16y agoMeanwhile, Plagued by Lawsuits, McAfee Founder Hunts for Cures in Belize http://www.fastcompany.com/magazine/145/fantasy-island.html http://www.fastcompany.com/magazine/145/fantasy-island.html
- epynonymous 16y agoi think i speak on behalf of many here: WHAT... THE... FUK?!? that's like trojan buying a porno studio, sure they're in a related field but where the heck is the synergy?
- naturalized 16y agoGood news for AMD and ARM that Intel is getting diluted with irrelevant stuff!
- MikeCapone 16y agoI'd have taken a dividend check...
- jacquesm 16y agoWhat we need is operating systems that are escalation attack proof, not hardware based anti-virus. I was hoping something like this would break through: http://en.wikipedia.org/wiki/Capability-based_security 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.
- azim 16y agoI don't think we'll see any change to AV on the desktop. That's not a fast-growing market. Enterprise-grade security "in the network" on the other hand is a multibillion dollar market, and growing fast. Signature-based detection is still the premier way of blocking threats like email spam and malware. In order to scale to the higher bandwidths that today's networks run at, it's necessary to use purpose-built hardware for network and regex processing.
- auxbuss 16y agoCame over to HN for answers to this WTF. But even here we have none. AV is snake oil. What do Intel have in mind?
- auxbuss 16y agoWhy is this voted down? It's true, no-one here has a coherent, rational understanding of why Intel has made this move. Everyone is asking why and no-one can comprehend the move. Nothing wrong in that. Either Intel has a crafty powerplay or they are off plan. Surely the issue isn't calling AV snake oil. Really. In this audience?
- gamble 16y agoIt's always interesting to see the business press scratch its head after baffling acquisitions like this and try to spin a coherent explanation of how the two companies fit together. The same thing happened when eBay bought Skype, but wishing didn't make that deal logical either.
- jsz0 16y agoIntel just bought Texas Instruments cable modem division so maybe they're looking to make a big push into the CPE market? x86 all-in-one gateways with embedded security & AV scanning perhaps? McAfee has tons of deals with ISPs so this would be a big foot in the door for Intel to push not only IP gateways but other types of set tops too. $7.7B is a big price tag but if my theory is correct you need to look at it in perspective of how many CPE devices are sold per year -- cable modems, routers, set tops. Presently they're all using ARM, PPC or MIPS chips. That's a huge potential growth area for low power x86. Wouldn't surprise me to see Intel pickup Motorola's set top business in the near future.
- mkramlich 16y agoIntel + McAfee doesn't seem like a good fit. Also, McAfee's cash cow has been the Windows installs it effectively patches with extra "security". Seems like that market does not have a rosy future, compared to alternatives like Mac and Linux. So weird time to make a bet on the future of Windows security add-on demand. 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.
- teyc 16y agoIntel's fortunes are closely tied with Windows. With the rise of the ARM devices, decline of Windows, AND having other x86 manufacturers closing in, Intel has to pivot. 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.
- lushootseed 16y agoI am completely at a loss to explain why Intel would do this. If Intel really wanted to go beyond hardware, it could have entered mobile & tablet market providing completely closed systems like iWhatEver. McAfee of all?
- xl-brain 16y agoDoes anyone know if this has to go through shareholder approval? Maybe there is a chance we can defeat this. I'm a shareholder and I'm considering dumping the stock. I haven't seen anything this bad since the AOL/TimeWarner debacle.
- borisk 16y agoIntel exec Renee James discusses goals for McAfee (Q&A) - http://news.cnet.com/8301-13924_3-20014160-64.html http://news.cnet.com/8301-13924_3-20014160-64.html
- alexdong 16y agoI found this article[1] provides an interesting explanation: Intel is trying to integrate anti-virus software into mobile devices chips so that they can catch the mobilization wave. Feels quite similar to Intel's acquisition of many other vertical chip makers[2]. 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-mcafee-takeover-ftimes-c6e0e029015c.html http://uk.finance.yahoo.com/news/intel-looks-to-secure-mcafe... [2]: http://www.google.com/search?hl=en&tbs=cdr%3A1%2Ccd_min%3A1%2F1%2F2000%2Ccd_max%3A1%2F1%2F2009&q=intel+acquire+chip+maker&aq=f&aqi=&aql=&oq=&gs_rfai= http://www.google.com/search?hl=en&tbs=cdr%3A1%2Ccd_min%...
- nivertech 16y agoMaybe Intel needs more office space in Santa Clara? ;) What does it make a price per sq. foot for McAfee office space? 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...
- nivertech 16y agoOff-course buying $MFE is better investment for $INTC, than Itanium or Larabee, but for this kind of money they better buying $NVDA or $ARMH http://twitter.com/nivertech/status/21696999486 http://twitter.com/nivertech/status/21696999486