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Demand for security is on the rise, as computing devices become increasingly mobile and connected. According to Technology Business Research, expects Intel to quickly move to embed McAfee technology into all of its device platforms, providing a stronger baseline of security.

The addition of McAfee will differentiate Intel's platforms from competitive offerings by Advanced Micro Devices as well as ARM. Going forward, Intel wants IT managers and consumers to associate McAfee, security and Intel. TBR believes Intel ultimately views its planned acquisition of McAfee as a means of continuing growth by adding hardware-based security to its numerous platforms for PCs, embedded devices and, increasingly, mobile devices. Through the acquisition Intel will position security as the “third pillar” of its device platforms, following energy efficient performance and Internet connectivity.

Intel’s acquisition of McAfee will also change the landscape for security software. While dwarfed by market leader Symantec, McAfee enjoyed the differentiation provided by being the largest pure-play security vendor. Whereas Symantec worked to balance both security and systems management, McAfee’s sole focus was on improving and expanding its presence in the security space. After riding its pure-play status and frequent acquisitions to close the gap in security, McAfee now joins Symantec in providing security as part of a much broader product set. McAfee will hand the title of largest pure-play security vendor to Trend Micro in return for the multiple benefits of joining a much larger organization, including revenue stability, the ability to increase cross-selling, product integration and access to greater financial resources. McAfee will continue to sell and support its current product lineup under Intel.

More recently, Intel has begun internally leveraging software to augment its platforms, following the belief that today’s platforms require both software and hardware. To that end, Intel has made software a vital piece of its efforts to win in the tablet and handheld devices space. The company has partnered with Nokia to spur development of the MeeGo operating system and created the Intel AppUP application store.

According to TBR, Intel’s immediate goals are to better protect device users in tasks such as social networking, e-commerce and online productivity. TBR believes Intel and McAfee are likely to benefit significantly from rising demand for embedded mobile security that has a minimal impact on device performance; however, TBR believes Intel will continue to focus on selling silicon. Therefore, the chipmaker hopes the integration

TBR believes that the rise of sensitive computing tasks performed on mobile devices will cause demand for security to continue to grow. Although Intel’s acquisition of McAfee may not have an immediate impact on the PC market, we expect the tie-up to change the dynamic of hardware-software partnerships.

TBR claims the agreement with McAfee will pave the way for additional embedded software agreements, creating a new distribution channel with powerful influence over the ultimate success or failure of software makers, based on their ability to partner with vendors like EMC, IBM and HP, which use hardware platforms as vehicles for software sales.

However, the developments will not fully take effect until approximately 2012, when Intel begins integrating McAfee directly into its hardware. The companies have been working together for 18 months and will release joint products in 2011; however, TBR does not expect the first fully-embedded security platforms to arrive until 2012.

Tags: Intel, McAfee, Business

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