AT&T buys VeriSign consulting biz

The move strengthens the company's security offerings

The sunken economy will likely only improve business for AT&T Inc.’s latest acquisition: VeriSign Inc.’s Global Security Consulting Services.

AT&T bought the unit Oct. 1 for an undisclosed amount.

“As security vulnerabilities and threats increase during a downturn in the economy and compliance regulations become more stringent and organizations look to cut [costs], the security services market will reveal strong customer demand for security consulting and security operations services,” predicted Irida Xheneti, a research analyst at IDC, in a report released earlier this year.

IDC estimates the annual enterprise information technology security services market in the United States at $11.7 billion, with the security consulting services market accounting for $3.6 billion of that total.

The U.S. security services market is expected to grow at an annual rate of 15.9 percent, Xheneti said.

AT&T’s recent acquisition “aligns VeriSign’s security consulting experience in comprehensive risk assessment with AT&T’s suite of network-based cybersecurity services,” AT&T officials said in a statement.

VeriSign’s consulting business includes practices in telecommunications, media and entertainment, enterprise wireless and mobility, global supply chain consulting, and global security consulting.

"The combined capabilities of VeriSign's security consulting business with AT&T's global reach, networking, and security portfolio will broaden our consulting and risk analysis expertise, and enable us to more quickly develop and bring to market capabilities to address the evolving security needs of businesses around the world," said Ron Spears, chief executive officer of AT&T Business Solutions, in a statement.

The acquisition is also in line with advice to start getting ready for the technology industry’s recovery in 2010, from analysts such as Forrester Research Inc.’s Andrew Bartels. “Smart vendors will keep investing in research and development,” Bartels said in a report published in April. “If you’re a large public company, cutting R&D investment or squeezing clients to try to maintain profit margins and impress shareholders will be a fool’s game,” he said.

Acknowledging the importance of continuing research and development efforts, Spears said in a statement that “AT&T has long been a pioneer in the development of cybersecurity services and capabilities, with AT&T Labs and its cybersecurity organization working closely together to provide industry-leading enterprise services and technology.”

Although the terms of the deal were not announced, it’s likely that AT&T, a holder of General Services Administration Networx Universal and Enterprise contracts, got a bargain. Between 2004 and 2006, VeriSign paid close to $1.3 billion for about 20 businesses, which it has been selling off as part of a restructuring plan and for which it will receive about $750 million, said Thomas Rasmussen, a research associate at the 451 Group.

Just days earlier, AT&T bought mobile Web application developer Plusmo Inc., based in Santa Clara, Calif. The terms of the deal were not disclosed.

Reader Comments

Sat, Oct 10, 2009 computer consultant http://www.nwcsupport.com/

Really combination of capabilities of VeriSign's security consulting business with AT&T's global reach will help us very much.

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above

What is your e-mail address?

My e-mail address is:

Do you have a password?

Forgot your password? Click here
close
SEARCH
contracts DB

Trending

  • Dive into our Contract Award database

    In an exclusive for WT Insider members, we are collecting all of the contract awards we cover into a database that you can sort by contractor, agency, value and other parameters. You can also download it into a spreadsheet. Read More

  • Is SBA MIA on contractor fraud? Nick Wakeman

    Editor Nick Wakeman explores the puzzle of why SBA has been so silent on the latest contractor fraud scandal when it has been so quick to act in other cases. Read More

Webcasts

  • How Do You Support the Project Lifecycle?

    How do best-in-class project-based companies create and actively mature successful organizations? They find the right mix of people, processes and tools that enable them to effectively manage the project lifecycle. REGISTER for this webinar to hear how properly managing the cycle of capture, bid, accounting, execution, IPM and analysis will allow you to better manage your programs to stay on scope, schedule and budget. Learn More!

  • Sequestration, LPTA and the Top 100

    Join Washington Technology’s Editor-in-Chief Nick Wakeman as he analyzes the annual Top 100 list and reveals critical insights into how market trends have impacted its composition. You'll learn what movements of individual companies means and how the market overall is being impacted by the current budget environment, how the Top 100 rankings reflect the major trends in the market today and how the biggest companies in the market are adapting to today’s competitive environment. Learn More!