Strategic Alliance between McAfee and Verizon Business Aims for the Clouds

The phrase “strategic alliance” is abused, cheapened, and trivialized through rampant overuse in the information-technology industry. Occasionally, however, a strategic alliance warrants the designation.

Take, for example, the strategic alliance announced today by McAfee and Verizon Business. This is an extensive, far-ranging partnership, bringing together each company’s respective strengths today and extending them ambitiously into the future.

The highlight of the partnership is the companies’ commitment to jointly develop and market a suite of next-generation, cloud-based, managed-security solutions for enterprise and government customers. If this initiative is executed well and brought to fruition, it has the potential not only of being lucrative for McAfee and Verizon, but also of providing a secure foundation for the widespread adoption and proliferation of enterprise-class cloud computing.

But the announcement wasn’t just about the future. A range of initiatives and services are available immediately.

As of now, for example, Verizon Business will offer its customers McAfee’s full range of enterprise security solutions. The McAfee offerings will broaden the choice of security solutions available to Verizon Business’ customers while helping McAfee expand its distribution channel. That’s a double-edged sword, of course, because there is no question Verizon Business will compete against, and often overwhelm, preexisting McAfee channel partners.

Verizon Business also will offer McAfee’s PCI (Payment Card Industry) compliance services to banks and other organizations that support merchants that handle fewer than 20,000 e-commerce transactions or up to one million credit card transactions annually. It’s potentially a big market, encompassing a group of retailers that accounts for nearly a third of all credit-card transactions.

McAfee and its customers also will gain access to Verizon Business’ network of 1,200 security professionals, providing a lot of feet on the street capable of designing, implementing, and integrating security solutions.

Another interesting aspect to the relationship is Verizon Business’ commitment to provide data-center outsourcing services to McAfee. Verizon Business will help McAfee consolidate its data centers, enabling the latter to improve round-the-clock management of its web-hosting operations and set the stage for rollout of cloud-based security services.

Speaking of which, the cloud-based security services will be managed and operated by Verizon Business. The services will include McAfee security technologies such as firewalls, intrusion prevention services, anti-malware, content control, and SSL VPNs.

A McAfee spokesperson said some of the cloud-based security services are being used now by a small number of customers, but that wider availability is scheduled for mid 2010. That availability will span North America, South America, Europe, and the Asia-Pacific region.

From top to bottom, the partnership is a major breakthrough for McAfee. It will result in some friction with channel partners, but the upside for McAfee more than compensates for the diplomatic overtime its field representatives will have to endure.

It’s a good deal for Verizon Business, too, enabling it to extend its push into managed services. The partnership also allows Verizon to establish a credible security foundation for cloud-based application services, which have understandable appeal to service providers with prodigious hosting facilities.

The partnership stands as a testament to the technology and thought leadership McAfee has established in framing its vision for cloud security. It got out ahead of the curve — and ahead of its competitors — in staking those claims.

Having that edge in a new and potentially lucrative market will serve it well. The consumer anti-malware franchises that Symantec and McAfee built are under increasing attack from free products, including Microsoft Security Essentials (MSE), which is more than good enough to eat into the market share and revenue of the incumbents, especially in a new economic reality that favors parsimony.

McAfee has adapted well, changing its emphasis and apportioning its resources accordingly. The company has more than held its own against Symantec in enterprise markets, and it has taken a leadership position in cloud security. The strategic partnership with Verizon Business represents strong validation that McAfee is on the right course.

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