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Intel Buys McAfee

by Sean P. Aune | August 19, 2010August 19, 2010 2:00 pm PDT

Usually when a company is about to drop several billion on buying another company, we at least hear some rumors about it. That being said, apparently everyone was taken by surprise today when Intel announced it was buying security software company McAfee for a whopping $7.68 billion in cash ($48 a share), a 60 percent premium over the closing price of the stock yesterday.

Intel and McAfeeThe announcement today that McAfee would become a wholly owned subsidiary of chip maker Intel was a bit of a surprise as it wasn’t easy to immediately see the connection between the two companies. However, Paul Otellini, Intel president and CEO, explained it as, “With the rapid expansion of growth across a vast array of Internet-connected devices, more and more of the elements of our lives have moved online.” He went on to add, “In the past, energy-efficient performance and connectivity have defined computing requirements. Looking forward, security will join those as a third pillar of what people demand from all computing experiences.”

While still a bit befuddling, Renée James, Intel senior vice president, added, “Hardware-enhanced security will lead to breakthroughs in effectively countering the increasingly sophisticated threats of today and tomorrow.”  And that’s where I stared to get a little bit worried.

Pretty much every security program out there slows down your system, and “hardware-enhanced security” sounds to me like they may very well build this into the firmware.  If they do, plan on a lot of firmware “upgrades” which are really security holes being patched.

This also may not be the best time for this sort of purchase, especially at a huge premium, as Microsoft is working hard on its own Security Essentials program which is projected to remain free.  What will the value of McAfee, or any security software company, be if that does indeed happen?  Not a whole lot, I assure you.

What say you?  Does this purchase make any sense to you?

Sean P. Aune

Sean P. Aune has been a professional technology blogger since July 2007, but his love of tech dates back to at least 1976 when his parents bought...