Microsoft to Acquire Firefly

Laying to rest recent buyout rumors, Microsoft Corp. announced today it signed an agreement to acquire privacy technology leader Firefly Network Inc.

As reported in Mecklermedia’s Internet World newspaper on March 30, Firefly’s performance has not always met expectations, and analysts have questioned the Cambridge, MA-based company’s ability to forge ahead without a significant cash influx.

Although financial details of today’s deal were not disclosed, recent reports have suggested the selling price was under the $40 million mark.

Microsoft said in a statement today that the acquisition will enhance the software giant’s ability to deliver products and services that meet the Platform for Privacy Preferences (P3P) protocols being agreed to by the World Wide Web Consortium (W3C).

Firefly, along with MCI Communications, AT&T Corp., IBM Corp., Netscape Communications Corp., Oracle Systems Corp., and Microsoft, has played an intrinsic role in the push for P3P standards.

“This transaction represents a milestone for the individual, the industry
and the growth of Internet commerce by placing people in control of their
personal information,” said Nick Grouf, Firefly’s president and chief
executive officer, in a statement.

“This will provide consumers with the assurances they need to make the Web a part of their everyday life. We’re excited by the opportunity to utilize Microsoft’s significant resources to help us realize the broad consumer base that would have otherwise required many years for us to achieve alone.”

Microsoft said Firefly will move its Cambridge operations to Redmond, WA, and its employees will report into the Web essentials group, part of Microsoft’s interactive media group.