Spamming for Dollars
Yahoo! News - Spamming for Dollars
By Cynthia L. Webb, washingtonpost.com Staff Writer
Fighting spam has turned into such a big business that anti-spam companies are becoming a hot commodity of their own.
Computer security firm Symantec is scooping up Brightmail, a San Francisco-based anti-spam and security software maker, in a $370 million cash deal, the company announced yesterday. It's a different exit strategy for Brightmail, which had filed plans to go public in hopes of raising some $80 million.
The decision bucks the trend set by Google and other companies, including BlueNile, to trust in the Street as the technology sector mends.
"The move suggests that despite so-called Google fever, entrepreneurs and their backers are considering various options in the face of a still-uncertain IPO market. Some venture capitalists are pushing private companies to merge rather than take the public-offering route, as a revenue-producing company can command almost as large a valuation with a sale as it would with an IPO. Brightmail, which reported revenue of $26 million in 2003, had received backing from several venture-capital firms, including Accel Partners and Technology Crossover Ventures, both of Palo Alto, Calif.," The Wall Street Journal reported. The paper noted that Symantec already held a roughly 11 percent stake in the company, but wanted to buy Brightmail to boost its security products.
• The Wall Street Journal: Symantec To Buy Brightmail, Averting An IPO (Subscription required)
The San Jose Mercury News said the acquisition "gives Symantec a foothold in one of the hottest areas of computer security -- helping customers filter out billions of unwanted e-mail messages. Spam increasingly is seen as not just an annoyance but also as a security threat. The mass messages often carry computer worms and viruses. Symantec, the maker of Norton anti-virus software, has been working to offer businesses a wider array of computer security products and services." On that note, CNET's News.com reported that Symantec has acquired a number of companies in the past two years, including SafeWeb and On Technology.
• The San Jose Mercury News: Symantec To Buy Anti-Spam Company (Registration required)
• CNET's News.com: Symantec To Buy Brightmail
Symantec's competitors have also been on a buying spree. "Symantec and its closest rival Network Associates Inc. have been acquiring smaller computer security companies as they seek to offer a wider package of network and computer security to large businesses. Spam has become a growing concern for companies and individuals, resulting in clogged network traffic and wasted productivity in the time people spend to eliminate unwanted ads touting everything from miracle herbs to get-rich-quick schemes," Reuters said.
• Reuters: Symantec To Acquire Antispam Company Brightmail
Symantec explained more about why it decided to acquire Brightmail, which was already a partner for the company. "Spam has increasingly become one of the most severe threats to individuals and enterprises today, topping viruses as the number one problem plaguing email systems and administrators," said John W. Thompson, Symantec chairman and chief executive, in a statement. Steve Cullen, Symantec's senior vice president of security products and solutions, told the Merc: "We are big believers that to protect against these blended threats, you really do need to have multiple technologies."
The Associated Press detailed how Brightmail's technology works. "San Francisco-based Brightmail provides software that uses filters and other proprietary technologies to block spam at the customer's Internet gateway, the point at which Internet traffic enters the public network. Brightmail's corporate customers include eBay Inc., Deutsche Bank, Cisco Systems Inc. and Bechtel Corp. It also provides spam protection to major Internet service providers, including AT&T WorldNet, Cox Communications, EarthLink, MSN and Verizon Online.
• The Associated Press via washingtonpost.com: Symantec To Buy Antispam Firm For $370 Million
Sex and the Single Spammer
In other spam news, sexually explicit spam now must be clearly labeled per a new Federal Trade Commission rule that went into effect yesterday. The rule is mandated by a six-month-old national anti-spam law that already is under fire from a number of different quarters for being ineffective in cutting the amount of junk mail flooding the nation's in-boxes. Speaking for myself, I got a slew of shady e-mails this morning alone that weren't kid-friendly and bore no label... Indeed, to the spam industry this rule might be nothing more than a hiccup, despite assurances from the rule's supporters who will say, "just give it time."
More on the rule, courtesy of The Associated Press: "The rule also bars graphic images from appearing in the opening body of the message. Instead, the recipient must take some action in order to see the objectionable material, either by scrolling down in the e-mail or by clicking on a provided link. Spammers who violate the rule face possible imprisonment and criminal fines of up to $250,000 for individuals and $500,000 for an organization. But tracking down violators can be difficult because spammers often try to escape being directly identified by using forged return addresses or by bouncing their e-mails through unprotected relay computers on the Internet."
• The Associated Press via washingtonpost.com: FTC Requiring Labels On Explicit Spam (Registration required)
Open Sesame
For many people, using a wireless phone has provided a haven from telemarketers. Not for long.
"After years of anonymity, the numbers of most of the nation's mobile phones will be compiled later this year in the first wireless directory. The database being assembled by the Cellular Telecommunications and Internet Assn. is expected to include about 75% of the 163 million mobile phones in the United States, making looking up a wireless number as easy as dialing 411," The Los Angeles Times reported today. "The association is pitching the directory as a boon for real estate agents and other on-the-go professionals who want people to be able to find their mobile numbers. But privacy advocates, some members of Congress and even a major cellular carrier -- Verizon Wireless -- fear that mobile phones, once immune to telemarketers and e-mail spammers, could become as vulnerable as home telephone lines and computer in-boxes."
• The Los Angeles Times: Coming Soon: A Cellphone Directory (Registration required)
A Phat Telco Deal?
The telecom sector is showing new signs of life. Tellabs Inc. today said it has inked plans to buy Advanced Fibre Communications for $1.9 billion in cash and stock. The deal creates "a major player in the telecommunications-gear market as the industry switches to broadband standards," Dow Jones Newswires reported, noting that Tellabs makes data, voice and video transport and access systems.
The Associated Press said "Tellabs has been through major changes in the past few years. The company has slashed jobs, shuttered all plants and outsourced manufacturing to focus on research and development and services."
• Dow Jones Newswires via The Wall Street Journal: Tellabs to Buy Advance Fibre For $1.9 Billion in Cash, Stock (Subscription required)
• The Associated Press via washingtonpost.com: Tellabs Agrees To Buy Telecom Supplier AFC (Registration required)
Speaking of telecom, The New York Times today detailed Lucent Technologies's efforts to put the telecom sector's dark days behind it. An excerpt: "Patricia F. Russo has little time to exhale. As chairwoman and chief executive of Lucent Technologies, she has returned the telecommunications giant to modest profitability by eliminating tens of thousands of jobs, slashing billions of dollars in debt and settling major lawsuits with investors. This week, the company settled a suit by the Securities and Exchange Commission (news - web sites) over its accounting practices, and agreed to pay a $25 million fine," the newspaper said. "But Ms. Russo, who took the helm at Lucent during the depths of the telecommunications collapse in 2002, is anything but sanguine. Having staved off Lucent's financial freefall, she is now in a race against time to develop new products and services that will allow Lucent to survive as the entire industry changes around it."
• The New York Times: Chairwoman Pulls Lucent Back From the Brink, but Not Out of the Woods (Registration required)
Put on Your Game Face
Sammy Corp., a Japanese gaming company known for its pachinko pinball machines, is purchasing video game company Sega Corp. in a stock deal valued at $1.4 billion, the companies said.
The San Francisco Chronicle noted for "Sega, which has its U.S. headquarters in San Francisco, the acquisition closes a turbulent chapter for one of the most recognizable names in video games. The company, best known for its speedy Sonic game character, has been struggling for the last few years and has been rumored to be a takeover target. Last year, Sega reported $77 million in net income on $1.7 billion of revenue. Sammy reported profit of $285 million on $2.2 billion in sales. Combined, their revenue would exceed Konami Corp., the largest Japanese game software firm. The two firms will combine their operations to create a new subsidiary, Sega Sammy Holdings Inc., by Oct. 1, and fully integrate the businesses by March 2007, the firms said."
Reuters reported that Sega shares "soared on Wednesday after its top shareholder, Sammy, said that it would buy out Sega and merge the two companies under a holding company," but added later that "analysts expressed skepticism about a planned merger that failed last year, after the two sides disagreed on management style and other terms of an integration. In subsequent months, industry watchers speculated that Microsoft was interested in buying Sega."
• The San Francisco Chronicle: Pachinko-Maker To Acquire Sega
• Reuters via CNET's News.com: Sega To Be Bought By Arcade Giant
Microsoft: Corporate Coupon Cutter
Times are good for Microsoft. The company has oodles of cash in the bank and the company is making strides to beat back various legal volleys. But the company is looking for ways to save more dough in these leaner economic times and is cutting some employee benefits to slash costs, The Seattle Times and Seattle Post-Intelligencer reported today. "The company announced to workers Tuesday that it was cutting prescription-drug benefits, tightening parental-leave policies and making it more expensive for them to buy stock. It also will decrease the vacation time given to future employees. The cuts are expected to save the company at least $80 million a year, and come as part of an across-the-board effort to reduce costs. Microsoft has promised investors it will limit new spending in the coming year," the Times reported.
• The Seattle Times: Microsoft Cuts Some Perks With An Eye On Bottom Line
• The Seattle Post-Intelligencer: Microsoft Trims Benefits To Cut Costs
Filter is designed for hard-core techies, news junkies and technology professionals alike. Have suggestions, cool links or interesting tales to share? Send your tips and feedback to cindyDOTwebbATwashingtonpost.com. (Yes, those spammers have been having a lot of fun with my e-mail address lately.)
May 20, 2004 at 07:10 PM in Spam | Permalink
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