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Symantec, Veritas Leaders Tout Merger

Leaders of Symantec and Veritas met with investors Wednesday to convince skeptics of the wisdom of the marriage between the industry giants.

Symantec Chairman and CEO John Thompson said a combination of the leading security software and back-up software makers will help solve problems many CIOs face: Preserving information integrity while making it highly available.

Thompson said customers have told Symantec and Veritas some of their major challenges include reigning in the complexity, cost and compliance factors of information technology.

This comes as security threats such as viruses and other malicious intruders are more pronounced and a glut of data threatens to clog corporate infrastructure. To make matters more challenging for CIOs, they are faced with stringent compliance regulations such as Sarbanes-Oxley and HIPAA.

While most analysts and software vendors praised the proposed $13.5 billion merger, skeptics have expressed concerns that a merger of two large companies will likely fail.

But Thompson, who was joined by Veritas CEO Gary Bloom, said the merger will yield a $5 billion company at the close of the merger with $5 billion in cash. The market opportunity according to IDC will be approximately $56 billion by the end of 2007.

This would forge a powerhouse of security and storage its leaders believe will be well equipped to address the challenge of managing infrastructure complexity with a one-stop shop.

That both companies support as many heterogeneous platforms as exists on the market is no small feat either, Thompson said, noting that Symantec's and Veritas' combined attention to Windows, Unix and Linux systems give customers a deep well to draw from.

Specific details on the integrated product roadmap were scant, but Thompson noted that lack of overlap will likely clear any hurdles the U.S. Justice Department might impose on a merger of this magnitude. He said he expected the deal to be consummated in the second quarter.

Bloom said one example of products complementing each other could be the provisioning technology each acquired in acquisitions. Veritas acquired Jareva provision servers while Symantec nabbed On Technology to provision desktops.

In an example of how core Symantec products might work together, Bloom said Symantec's intrusion detection and prevention software could be tied to Veritas' back-up products, making the combined offering more proactive than reactive.

For example, Symantec's antivirus software would protect users against an attack. Veritas, through its acquisition of KVault Software would provide the e-mail archiving software to back up the e-mail server for Microsoft Exchange systems should a virus enter the system.

This would ensure data availability. Security, plus availability, Bloom argued, makes a compelling value proposition.

"We want to offer a preemptive environment," Bloom said via Webcast. "It's a lot cheaper to provide preventative medicine."

As for the competition, such as Microsoft's entrance into the antivirus and antispam space, Thompson pointed out that Symantec is already well established in this market. He expects Microsoft's presence to have minimal impact on Symantec's results this year.