Analyst: McAfee buy moves Intel toward IBM model

8/19/2010 2:43 PM EDT

It will be interesting to see if Intel can get an edge over AMD with "hardware-enhanced security," but I don't see it. Unlike the Wind River deal that helps dribve Intel in embedded, McAffee won't extend Intel's traditiponal business into new markets.

8/19/2010 2:54 PM EDT

It is puzzling that Intel as a company does not seem to have a concrete growth strategy.

Until a few months back, everyone believed Otellini wanted Intel to grow to become a powerhouse in cell-phone chips by backing Atom as well as SoCs for that area. Intel was trying to offer Atom to cell phone makers through TSMC to gain market share as well. Now, Intel seems to be going after software by buying McAfee.

Intel needs to decide and clearly formulate its growth strategy. Mr. Otellini, is Intel's growth going to come through Cell-phone chips? Or is it software?

8/19/2010 4:12 PM EDT

We currently have several large software companies, (Google, Microsoft, etc...) starting to sell/license hardware platforms.
So whay not have a large hardware company, (Intel in this case) starting to sell/license software? Intel already has many software products aimed at product development.

8/19/2010 4:16 PM EDT

It is a cycle, within a decade they will be selling all these software divisions. They will saturate the industry with services and software and everyone will quickly move out.

8/19/2010 5:09 PM EDT

If antivirus is such a great sell, why hasn't Microsoft already bought McAfee, or developed a viable competitor? Microsoft seems to have tried to make the OS more secure rather than patching AV on top of it. If so, opportunities dry up for McAfee/Intel.

Also, why not buy an AV that people actually like?

Furthermore, this acquisition would further cement ties between Intel and Microsoft, because McAfee's center is in Windows. Kind of silly if you think Microsoft is trying to move away from the need for AV.

8/19/2010 8:03 PM EDT

Thanks for this article. But there’s nothing new here about another company purchasing another company. Companies have been during software acquisitions for years, this is a normal business practice in a competitive society. What does it do? It gives the Intel management team many options. There’s nothing wrong with that. And with information security, for some companies, in its early stages; I think it is a wise move. By the way, Wall Street predictions have been completely wrong or off track for the last few months, so I will bet my investment with Intel and McAfee.

8/20/2010 12:08 AM EDT

The real question is whether Intel will or can pursue a foundry model like Samsung or IBM(to a much smaller degree).

8/20/2010 5:16 AM EDT

I am guessing this acquisition is less of a diversification into services and software and more of an augmentation of full offerings and complete products where cloud-bound servers come with built-in security while getting on-going revenue streams from consumers in the form of subscriptions or protection premiums.

I will continue to state that I expect computers to come with virus protection guarantees and free updates and that no one should accept to continue to pay for an insurance against hardware that basically fails to protect you. This is like being forced to pay every month for your car alarm that can easily be broken into or to continue to lease a safe after you have bought it to keep your contents safe. So if Intel will sell processors with lifetime virus protection, I am willing to pay a premium for that..

8/20/2010 10:02 AM EDT

This looks like Intel is willing to bet over $7 billion that Microsoft will never get its security right. If you get a computer virus clearly your OS has failed at one of its primary responsibilities. This is a very strange bet to place against a major partner.

8/20/2010 11:33 AM EDT

Looks like Intel has lost its way, flaiing as it has difficulty under its own weight! To have spent $~7B seems like a gross mistake. The only positive that we see is that if a Virus monitoring and screening is in the HW is speed .. but my experience is that performace is degraded significantly by this feature in the current software version.

8/20/2010 1:51 PM EDT

I find it interesting that there is such a range of comments and opinions about this deal. Everyone seems to have a different theory about Intel's strategy and about the wisdom of the deal.

8/20/2010 10:25 PM EDT

Intel seems to be getting more and more defocused, with all these various acquisitions. The thing about security risks like viruses is that they always evolve to defeat the latest defenses. Hardware isn't flexible or fast enough to adapt, compared to software. So this nearly 8 billion purchase is totally unrelated to its 7 billion for latest fabs. Security is a software, not hardware responsibility.

8/20/2010 11:13 PM EDT

I think we should take Intel at their word when they talk about 'Hardware-enhanced security...'.

Ineffective security is a serious problem that I'm sure hardware could help solve. I can see McAfee engineers saying, 'if the cpu or chip set could only ...'.

One example of what X86 could do is support buffer allocation with boundary check in hardware. Intel can set an example with their compilers supporting such capabilities.

Security should be re-thought from the ground up. Hardware, OS and security need to seamlessly cooperate. I believe the experience of a company such as McAfee could contribute greatly in this area.

8/20/2010 11:28 PM EDT

Re-registered on this site since I couldn't change my obsolete email address.

8/21/2010 5:24 PM EDT

It remains an illusion that Intel despite all the high buyouts and acquisitions have not rewarded shareholders through good stock acquisition. I always doubt this firm because it has many ethical challenges. But in this case, it may be reinventing itself.

8/21/2010 5:25 PM EDT

I am sure we can all find a rational explanation for this acquisition (future hardware-enhanced security of Intel chips, better secure server solutions etc.) but I have a feeling this is just another sign of Intel not knowing exactly where it wants to be in the future. Such costly purchases could come back to bite them in the future as it might distract Intel from their core business and reduce their financial muscle in the high-end microprocessor market.

8/22/2010 1:25 AM EDT

I am equally puzzled here. Its Microsoft software which need AV software, why is Intel fixing the problem using hardware. For people using Linux on Intel, this is useless hardware and for people using AMD with Microsoft its equally in-secure. So what is getting solved here?

Moreover AV is software that need daily upgrades, so the only hardware Intel can develop is special instruction sets to off-load processor during file access. If that's what is Intel plan, then it might increase cost of process pushing more Linux servers users towards AMD and I am pretty sure there will be a bigger crowd which will tend to save few buck at cost of AV run time.

8/22/2010 12:14 PM EDT

I am not sure why a hardware giant like Intel is planning to buy software side. Only one thing come in my mind, targeting on providing full package out in the market.

8/23/2010 10:26 AM EDT

According to an online article that I read this morning, it stated that Intel and McAfee have been working closely on a host of projects for 18 months and expect to show the first fruits of their labor early next year. This doesn’t sound these two companies that have not been communicating about different approaches; IBM model approach may be one that is on the table. But I am sure it is not the only one. I don’t believe that a company is going to invest all of it resources toward one model? If so, I am sure the Board of Director’s members will be voted out today by the stock holders.

8/23/2010 12:41 PM EDT

Intel has security feature like hardware random number generator built into the firmware hub. It can be foreseen that a more secure CPU is needed for better e-commerce operation.

Whatever insight McAfee can offer will enhance the Internet in general and Intel in particular... Imagine a virus free CPU by design...

You may need to separate the program memory & data memory space to reduce risk from buffer overflow attacks. Switching from VonNeumann to Harvard may be a way to do it but has to maintain compatibility with legacy software... Not straightforward but do-able with a MMU probably...