PGP Blogs

At this time of year, the world's best professional surfers gather just south of San Francisco at a beach called "Mavericks". They gather and they pray for the the giant storms to form 2,000 miles to the north in the Gulf of Alaska. When the weather and currents all cooperate, the result is some of the largest perfect waves on earth. In 1994, the leading big-wave surfer in the world caught one of these forces of nature at Mavericks and died surfing it. This is not a game for the faint of heart.

We have something directly analogous occurring in the IT industry at the moment. Seismic events occurring thousands of miles away in remote segments of the industry are driving an acquisition wave unlike anything we've seen in a generation. What we saw when Symantec acquired Veritas and when EMC acquired RSA, we've seen again with Cisco's acquisition of IronPort Systems: Several of the big players are redefining their roles in the IT sector and in so doing are generating waves that will almost certainly restructure our industry. This move by Cisco is particularly intriguing because it puts the company firmly in the application security space for the first time. Those of us in this business frequently debate, "Just what is the infrastructure?" The best operating definition I can think of is, "It's the stuff Cisco makes". For those techies in the audience, that basically means anything in OSI layer 4 or below. The layer 4/5 boundary also used to be a nearly immutable segment barrier... but no more. If Cisco is going to suck IronPort's malware filtering and high-performance email servers down into the infrastructure, just what does that mean for companies like Microsoft and Lotus that sell these solutions very differently (and to different people)? This move will also require that Cisco's traditional competitors seriously re-think the way they are currently surfing the waves of change in the networking sector. If Cisco can deliver a top-to-bottom communications infrastructure that includes voice, email, instant messaging, and all the underlying plumbing, what role does that leave for Nortel, Juniper, and Avaya? And it's not just Cisco's competitors that will be affected. Vendors in adjacent sectors including storage, servers, and even portable devices are going to need to determine how to best surf the waves that will be generated by the Cisco storm. As I said earlier about actually surfing, this is not for the faint of heart.

My guess is that the entire sector becomes much more complicated before it gets simpler. My belief is that there are going to be five or six key franchises worth owning in the Information Technology sector and that not one of them will look or act like any of the current leaders. I believe that some of the current leaders will absolutely be a part of the ruling oligarchy, but not in their current form. We'll need to wait a number of quarters to see how this all turns out and whether or not Cisco's acquisition really provides benefit to IronPort's customers. The one thing that remains clear to me, however, is that the new emerging leaders in the IT sector will all have to come to grips with the security policy and key management issues their acquisitions create. We do, of course, believe that PGP® platform with our open architecture and certificate-neutral solutions is uniquely positioned to address these issues. PGP Corporation already works with nearly all these big players and we'll continue to show how our combined offerings serve the largest enterprises in the world.

- Phil