Sophos acquisition casts doubt on Telstra AV deal

By Patrick Gray
25 September 2003 01:10 PM
Tags: nai, network, virus, spam, firewall, personal, associates, sophos
The acquisition of Canada based anti-spam software company ActiveState for US$23 million by anti-virus provider Sophos has the potential to alter a fresh deal between ActiveState and Telstra.

The acquisition comes as the ink dries on an agreement signed between Telstra and ActiveState. Under the agreement, the Canada based company provides software allowing Telstra to offer BigPond users new anti-spam and anti-virus filtering services. While the anti-spam technology is based on ActiveState's own technology, the anti-virus component relies on the McAfee engine, made by Sophos rival Network Associates (NAI).

Sophos' Asia Pacific managing director Rob Forsyth has hinted the company will try to use the acquisition to rip out the NAI technology. "We have arranged a meeting with Telstra... just to find out whether we can assist them further," he told ZDNet Australia .

Telstra had entered into negotiations with several vendors, Sophos being one of them. Forsyth says Sophos didn't win the contract because it was unable to provide the anti-spam solutions. "We approached Telstra to provide an anti-virus solution... effectively we were out-flanked," he said. "The purchase of ActiveState now potentially changes that battle ground. I say potentially because it's all too fresh."

The Sophos boss makes no qualms about his feelings for NAI. "NAI in the security content market have not been performing well according to IDC," he said.

The acquisition of ActiveState isn't an attack on NAI or any other vendor, he added -- Sophos just needed anti-spam software.

NAI's Asia Pacific marketing director, Allan Bell, says it's too early to know exactly what will happen in regard to the Telstra deal. "As far as this account is concerned I don't know the implications. They are using the MacAfee engine, but that's all I can say at this stage... it's very difficult to speculate on what that will mean," he said.

"Under the Telstra contract, NAI is currently supporting the ActiveState product," Bell added. "Sophos may want to renegotiate that contract."

The ActiveState anti-spam technology, PureMessage, is server based filtering software. It runs on most Unix/Linux based platforms, but does not currently run on Microsoft operating systems. NAI has its own solution, SpamKiller, which is based on the open source SpamAssassin engine. Bell says the billing functionality bundled with the ActiveState suite made it a more appealing choice for Telstra. "Telstra chose the best engine. They chose ActiveState because they needed the billing functionality," he said.

It isn't all bad news for NAI. Telstra today announced it will re-sell NAI's McAfee personal firewall on a subscription based model to BigPond users for around AU$5 a month.

A spokeswoman for Telstra told ZDNet Australia  it's business as usual. "We chose a third party vendor... based on several criteria, not on brand. It's the BigPond brand that our customers will rely upon and trust," she said. "Irrespective of [ActiveState's] ownership, performance and service levels remain unchanged."

"BigPond views the Sophos acquisition as a positive move because Sophos has a local presence in Sydney," she added.

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