Daily Archives: August 23, 2006

Epilogue on IBM’s Acquisition of ISS

Well, we knew IBM was shopping for a security acquisition, and ISS made more sense as a target than some of the other companies alleged to have been on IBM’s shopping list.

In an all-cash deal, IBM announced its acquisition of Internet Security Systems (ISS) today. The ISS purchase is the fourth major software acquisition for IBM in the past month, following the company’s acquisitions of Webify Solutions, MRO Software, and FileNet.

iBM had been making increasingly restive noises about wanting to become a major purveyor of security products and services for enterprise customers. ISS goes some of the way toward fulfilling those ambitions. IBM said it intends to use ISS’s expertise, service teams, and its software to extend and enhance the security-related solutions its provides to corporate customers.

If all proceeds according to plan, IBM will leverage ISS in three key respects. It will integrate ISS as a business unit within the infrastructure management services unit, part of IBM Global Technology Services; it will integrate some of ISS’s technologies and consoles into its Tivoli systems-management software; and it will mandate IBM Global Services to promote and sell ISS-derived managed security services to enterprise customers.

Like IBM’s other software acquisitions this month, ISS provides high-value code around which IBM Global Services can wrap consulting, deployment, and management services.

The question now is, will IBM make other security acquisitions to fill remaining gaps in its security portfolio? I think it’s certain that other acquisitions will follow, but not right away and not nearly as big as this deal.

Breaking News: IBM Acquires ISS for $1.3 billion

Well, my musings on IBM as acquirer of ISS proved correct. Details to follow.