EMC buys Network Intelligence

Acquisition underscores growing importance of security in the storage market, signals shaky outlook for go-it-alone security vendors

EMC Corp. will spend US$175 million to acquire security information provider Network Intelligence Corp.

The privately held Westwood, Massachusetts, company sells appliances that probe computer networks, providing security and compliance analysis.

EMC's latest acquisition, expected to close late Monday, underscores the growing importance of security technology to the storage vendor. Also on Monday, EMC announced that it had completed its $2.1 billion purchase of RSA Security, which will form the basis of a new RSA-branded security division within the company.

Former RSA CEO Art Coviello will head up this division, which will absorb the Network Intelligence business unit, EMC said in a statement.

Founded in 1996, Network Intelligence has more than 125 employees, according to the company's Web site.

With these latest acquisitions, EMC hopes to be able to sell security as part of a broader product portfolio, said Joe Tucci, EMC's chairman, president and chief executive officer. "It's becoming critical that security move beyond a point product solution," he said.

Analysts say security companies will find it increasingly difficult to go it alone, with technology giants such as Microsoft Corp., Cisco Systems Inc. and IBM Corp. moving quickly to add security features to their broader product platforms. Just last month, IBM said it would spend $1.3 billion to acquire managed security vendor Internet Security Systems (ISS).

Copyright © 2006 IDG Communications, Inc.

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