There I was, sitting in a cubicle in the men's room at the Symantec Corp. office in Santa Monica, California, minding my own business. I wasn't trying to eavesdrop or anything like that, I was just there to do my thing and get out.
But I would have had to be deaf not to hear the two Symantec guys chatting away about the intimate details of the company's financial situation as they tended to their business outside my cubicle. I didn't understand most of what they were saying because I'm just awful when it comes to accounting and financial stuff, but I did catch that one of the guys mentioned with some satisfaction that Symantec has $US125 million in the bank.
Of course that was none of my business, so I tried to just forget it. But you know how it is -- the harder you try to not think about something, the more you end up thinking about it. Then it occurred to me that if it was supposed to be secret, it -- by definition -- ceased to be secret when I became aware of it. So then I figured what the heck, if it isn't secret anymore, there's no harm in sharing it with you. Work with me here.
I mean, it's not like I was someplace I wasn't supposed to be. I was there as a member of a delegation of Asia-Pacific journalists whom Symantec had invited to visit its world headquarters in Cupertino (in the heart of Silicon Valley) and its satellite office (which houses the famed Symantec Antivirus Research Center, or SARC) in Santa Monica. And talk about access. We were even invited to dinner at the exquisitely decorated, elegant home of Symantec CEO Gordon Eubanks in the posh village of Saratoga, California, not far from the Cupertino headquarters. It was kind of surreal, as I found myself standing with Gordon in his living room, chatting about his former life as a nuclear submarine officer in the US Navy, and about where this stunning piece of art work or that lovely antique was acquired.
Indeed, a glance around the living room made it clear that Gordon isn't afraid to spend the money he's earned in the 14 years he's served as Symantec's CEO. And it has become equally clear that he isn't afraid to spend some of that $US125 million in Symantec's bank account when something particularly attractive comes to his attention, as demonstrated by such pursuits as his $27.5 million purchase in June of this year of the very cool Ghost disk-cloning technology developed by New Zealand's Binary Research.
Then there was Symantec's purchase in May of IBM Corp.'s antivirus business, followed by its purchase late last month of Intel Corp.'s antivirus business -- a deal worth $US18 million which gave Symantec access to Intel's systems management technology and which means that Intel's LANDesk Virus Protect product will be using Symantec's Norton AntiVirus as its virus scanning engine.
The Intel deal is particularly interesting to those of us in Asia who recall the close-knit partnership that Intel used to have with Taiwan-born Trend Micro Inc. Intel used to license Trend's virus scanning engine for use in LANDesk Virus Protect, and even built Trend's antivirus technology into firmware on its motherboards. In fact, Intel was so cozy with Trend that it took an equity position in the company, albeit a small one -- reportedly in the 1 per cent to 2 per cent range. Intel, incidentally, had shifted from Trend's antivirus engine to IBM's antivirus engine prior to its deal with Symantec, so you can see how incestuous all this is.
Now, depending on whom you talk to, you get differing accounts of whether or the extent to which Intel and Trend are still working together. Tommy Tam, sales manager at the Trend Micro office in Hong Kong, insists that Intel still maintains a 2 per cent equity stake in Trend, and he is adamant that Intel motherboards still ship with a Trend product called Chip Away Virus, which resides on the BIOS and checks for boot-sector viruses.
The Intel folks, for their part, declined to comment on the status of the equity investment, and at press time they were unable to speak conclusively about whether Trend technology is still being shipped on Intel-branded motherboards.
Of course, Intel is walking a fine line here, because it doesn't want to do or say anything to offend Symantec. After all, Symantec and Trend aren't the friendliest of competitors. You might recall that in May of last year Trend sued Symantec for alleged infringement of its patent covering server-based virus detection for data carried over the Internet, e-mail and groupware. Symantec was compelled to settle the suit in April of this year by agreeing with Trend to cross-license their antivirus applications and to share virus samples. And although Symantec tries to portray Trend as an also-ran in the antivirus business, the fact is Trend still commands a lot of respect. Just last week, CheckPoint Software Technologies Ltd. announced that it is licensing Trend's Internet gateway scanning technology. Not bad for an also-ran.
Anyway, the fact remains that no matter how much cash Symantec has in the bank, there are some things that money just can't buy -- like the wherewithal and the smarts to hook up with the right people. The deal with Intel was brilliant, not so much because Symantec got Intel's antivirus business, but because it gained access to Intel's superb systems management technology. Similarly, the deal with IBM gave Symantec an edge over the competition because it's working hand-in-hand with the brains at IBM's Thomas J. Watson Research Center on advanced antivirus technology.
Specifically, Symantec and IBM are developing what they call the Digital Immune System, which uses IBM's neural network technology to fully automate the processes of virus capture, analysis and update distribution. And they're using Intel's systems management technology as one of the building blocks, so you can see that all this fits together quite nicely.
You might have noticed, by the way, that I didn't mention how much Symantec paid for IBM's antivirus business. The fact is I don't know, and they wouldn't tell me. Maybe it's time for another trip to the gents'...
