IBM (NYSE:IBM) expanded its identity-management product portfolio today with the acquisition of privately held Encentuate.

Financial terms of the deal were not disclosed, though IBM officials have noted that all of Encentuate's staff would be coming over to IBM. In addition, IBM will rebrand Encentuate's Singapore lab into the new IBM Security Software Laboratory in that country.

The company plans to initially resell Encentuate's technology but fully integrate it into the IBM Tivoli brand by the end of the year. Tivoli Access Manager for Single Sign-on Version 7, due out in the third quarter, will be based on Encentuate technology.

Joe Anthony, program director, security and compliance management at IBM Tivoli, told InternetNews.com that version 7 add enhanced auditing and tracking as well as "breadth and depth for strong authentication support."

Although IBM has similar expertise in developing its own identity-management software -- in the form of Tivoli Identity Manager (TIM) 5 -- Encentuate gives IBM what Anthony described as a great product base with solid technology that will integrate well with other Tivoli products.

Zorawar Biri Singh Encentuate's president and CEO, commented that single sign-on has changed from its use primarily as a password-convenience technology.

"What has happened in the last few years is that compliance security at the application layer for end user access has become the forefront," Singh told InternetNews.com.

Singh added that Encentuate is six years into development of its technology and has built rich capabilities beyond single sign-on to provide end user tracking, compliance and audit reporting. He says Encentuate becomes even more valuable when integrated with the broader products of IBM Tivoli.

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"Single sign-on is interesting, but it's really the launch pad for a broader array of capabilities," Singh said. "From a sales standpoint we've had 80 or 85 customers historically, and I'm excited that our people will now be part of a bigger brand that is integrated end to end."