Dark Reading is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Risk

6/29/2006
07:20 AM
50%
50%

RSA Acknowledges Secret Suitor

The two vendors are rumored to be talking a marriage of storage and security

There is growing speculation that EMC may be about to drop $2 billion on software giant RSA in a bold move to bolster its own security story.

RSA, in a statement this morning, confirmed that it is "currently engaged in negotiations with parties regarding a potential strategic transaction" after the New York Times reported that a deal, potentially valued at more than $1.8 billion, may be imminent. Trading in RSA shares was also halted this morning.

The security specialist did not reveal the identities of its suitors and said that no definitive agreement has yet been reached. A prepared statement declared: "There can be no assurance that any agreement will be reached or that a transaction will be consummated."

EMC did not respond to Byte and Switch's requests for comment.

At least one observer, Richard Stiennon, chief research analyst at IT-Harvest, believes EMC could do worse than go after RSA. "I always thought that RSA was an undervalued gem in the security space," he explained. "RSA is everywhere, everyone knows how to use it, it's tried and tested."

If EMC acquires RSA it will get its hands on an extensive array of encryption technologies, as well as the vendor's SecurID authentication offerings. Up until now, EMC has mainly focused its security efforts on back-end systems, although RSA could open the door to the both the consumer market and desktop users. (See RSA Unveils Data Protection, RSA's Master Key Plans, and RSA to Access Mid-Sized Businesses.)

RSA has also been edging closer to the storage market. The vendor recently announced plans to extend its centralized key management software to new areas, such as databases, file systems, and (eventually) mobile devices. Earlier this month, RSA teamed up with Protegrity to integrate its Key Manager software with the latter's encryption offerings. (See RSA's Master Key Plans.)

The other potential bonus, of course, is RSA's 20,000-strong customer base, which includes big names, such as the U.S. Department of Defense, E*Trade Financial, and Barclays Bank in the U.K. EMC would also get its paws on a slew of smaller customers at a time when the storage vendor is pushing more and more of its technology in the direction of SMBs. (See EMC Delivers Insignia to SMBs, EMC Upgrades SMB SANs, Vendors Set Sights on SMB Windfall, and SNW: Small, SAS-sy & Safe.)

Stiennon told Byte and Switch that the jewel in the RSA crown is its strength in the financial sector. "Not only do they have the standard in [authentication] tokens, they also bought a company called Cyota that provides the anti-phishing standard for banks," he said. (See RSA to Acquire Cyota.)

EMC CEO Joe Tucci identified security and virtualization as potential target areas during the firm's recent analyst day, where EMC was urged to boost its security and digital rights management portfolio. (See EMC Nets nLayers, Scopes Security.)

EMC, which has spent $4.5 billion on a slew of acquisitions in just over two-and-a-half years, acquired digital rights management specialist Authentica earlier this year and has forged encryption OEM deals with Decru and Neoscale. (See EMC Acquires Authentica.) Despite these moves, there is a feeling in the market that no single vendor currently offers a silver bullet combining storage and security.

Certainly, security is the main area where users are looking for EMC to beef up its efforts. Of the 322 responses to a recent Byte and Switch poll, some 55 percent said the storage giant should target security for its next acquisition. This area was identified as the biggest gap in EMC's product portfolio. (See Readers Eye EMC's Expansion and EMC’s MVP.)

Stiennon feels that a possible EMC/RSA deal could pave the way for some major M&A in the security space. Up until now, he explained, most security acquisitions have been relatively small affairs. "There's a lot of roll-up activity, but not these billion-dollar deals," he said. Symantec, for example, could be a potential target for Cisco, which up to now has been "dabbling in the anti-virus space."

In trading today, shares of RSA rose $3.77 (19.47 percent) to $23.13. EMC's stock dropped 6 cents (0.53 percent) to $11.31.

— James Rogers, Senior Editor, Byte and Switch

  • Cisco Systems Inc. (Nasdaq: CSCO)
  • Decru Inc.
  • EMC Corp. (NYSE: EMC)
  • IT-Harvest Inc.
  • NeoScale Systems Inc.
  • Protegrity Corp.
  • RSA Security Inc. (Nasdaq: EMC)
  • Symantec Corp. (Nasdaq: SYMC)

     

    Recommended Reading:

    Comment  | 
    Print  | 
    More Insights
  • Comments
    Newest First  |  Oldest First  |  Threaded View
    COVID-19: Latest Security News & Commentary
    Dark Reading Staff 7/9/2020
    Omdia Research Launches Page on Dark Reading
    Tim Wilson, Editor in Chief, Dark Reading 7/9/2020
    4 Security Tips as the July 15 Tax-Day Extension Draws Near
    Shane Buckley, President & Chief Operating Officer, Gigamon,  7/10/2020
    Register for Dark Reading Newsletters
    White Papers
    Video
    Cartoon
    Current Issue
    Special Report: Computing's New Normal, a Dark Reading Perspective
    This special report examines how IT security organizations have adapted to the "new normal" of computing and what the long-term effects will be. Read it and get a unique set of perspectives on issues ranging from new threats & vulnerabilities as a result of remote working to how enterprise security strategy will be affected long term.
    Flash Poll
    The Threat from the Internetand What Your Organization Can Do About It
    The Threat from the Internetand What Your Organization Can Do About It
    This report describes some of the latest attacks and threats emanating from the Internet, as well as advice and tips on how your organization can mitigate those threats before they affect your business. Download it today!
    Twitter Feed
    Dark Reading - Bug Report
    Bug Report
    Enterprise Vulnerabilities
    From DHS/US-CERT's National Vulnerability Database
    CVE-2020-15105
    PUBLISHED: 2020-07-10
    Django Two-Factor Authentication before 1.12, stores the user's password in clear text in the user session (base64-encoded). The password is stored in the session when the user submits their username and password, and is removed once they complete authentication by entering a two-factor authenticati...
    CVE-2020-11061
    PUBLISHED: 2020-07-10
    In Bareos Director less than or equal to 16.2.10, 17.2.9, 18.2.8, and 19.2.7, a heap overflow allows a malicious client to corrupt the director's memory via oversized digest strings sent during initialization of a verify job. Disabling verify jobs mitigates the problem. This issue is also patched in...
    CVE-2020-4042
    PUBLISHED: 2020-07-10
    Bareos before version 19.2.8 and earlier allows a malicious client to communicate with the director without knowledge of the shared secret if the director allows client initiated connection and connects to the client itself. The malicious client can replay the Bareos director's cram-md5 challenge to...
    CVE-2020-11081
    PUBLISHED: 2020-07-10
    osquery before version 4.4.0 enables a priviledge escalation vulnerability. If a Window system is configured with a PATH that contains a user-writable directory then a local user may write a zlib1.dll DLL, which osquery will attempt to load. Since osquery runs with elevated privileges this enables l...
    CVE-2020-6114
    PUBLISHED: 2020-07-10
    An exploitable SQL injection vulnerability exists in the Admin Reports functionality of Glacies IceHRM v26.6.0.OS (Commit bb274de1751ffb9d09482fd2538f9950a94c510a) . A specially crafted HTTP request can cause SQL injection. An attacker can make an authenticated HTTP request to trigger this vulnerabi...