Cisco Improves Self Defense Moves

Cisco Systems acquired security monitoring provider
Protego Networks in a $65 million cash deal Monday, one of a flurry of
year-end mergers and consolidation among software providers in the past
week.

The privately held Protego, based in Sunnyvale, Calif., makes security
monitoring and threat management appliances for small-to-medium business
networks. Cisco said the purchase will help extend its self-defending
network initiative by integrating Protego into Cisco’s Security
Technology Group.

Cisco said it would pay about $65 million cash for the Protego
acquisition, which is expected to close in the second quarter of Cisco’s
fiscal year 2005 (January 29, 2005).

The deal would add an endpoint to yet another year of Cisco’s strategic
shift in providing a menu of security management systems to its large and
smaller business customers. Last year, it purchased intrusion detection
software maker Okena for $154 million in stock as part of its focus.

Protego’s products include appliances that monitor networks for threat
management and help administrators’ decision-making regarding effective use
of network and security devices. It does this, the company explained, by
combining traditional security event monitoring with network intelligence,
context correlation, vector analysis, anomaly detection, hotspot
identification and automated mitigation capabilities.

San Jose-based Cisco is the latest major technology company to jump into
software purchases in the past week. Oracle’s successful quest to purchase
PeopleSoft for $10.3 billion signaled not only consolidation in the
industry, but was soon followed by a consolidation among security and
storage providers, such as Symantec’s $13.5 billion purchase of storage play
Veritas. .

Protego and Cisco were partners before the acquisition: Protego is part
of Cisco’s AVVID program
(Architecture for Voice, Video and Integrated Data). It works with Cisco to
sell integrated security products to customers as they deploy new networks.