Perimeter eSecurity Strengthens Compliance for its Hosted Mail Portfolio with SECCAS Purchase

| Jan 17, 2008 | Internet/Managed Services - U.S. | Competitive Update

| Analyst: Amy Larsen DeCarlo

Current Perspective: Positive
Vendor Importance: Moderate
Market Impact: Moderate

Event Summary

January 15, 2008 – Hosted mail services company Perimeter eSecurity acquired Secure Electronic Communication Compliance Archival System (SECCAS), an outsourced provider of e-messaging compliance to public and financial services companies. This acquisition complements Perimeter eSecurity’s existing portfolio of more than 50 on-demand security services.

Analytical Summary

• Current Perspective: Positive on Perimeter eSecurity’s acquisition of messaging compliance vendor Secure Electronic Communication Compliance Archival System (SECCAS), because the deal gives the software as a service (SaaS) provider a unique service for managing and storing instant messaging and other electronic records that will appeal to brokerage and other firms seeking a way to capture and retrieve electronic records both from historical archives and in real-time. This provides businesses in heavily regulated industries with a proactive way to manage compliance to meet Security and Exchange Commission (SEC) and other federal, industry and internal corporate mandates around messaging.

• Vendor Importance: Moderate to Perimeter eSecurity, because the SECCAS purchase gives the provider a key compliance solution that further bolsters its already extensive hosted secure messaging solution portfolio. The provider has been boosting both its profile and its mail and security offerings through a series of acquisitions including the 2007 purchases of USA.net and Message Secure. With the SECCAS buy, the company picks up a service that it can offer on demand which will appeal to both its traditional customers as well as brokerage firms that have not been part of the company’s traditional client base.

• Market Impact: Moderate on the messaging market, because in integrating the SECCAS messaging compliance service into its SaaS services set, Perimeter eSecurity becomes an even greater force as a supplier of managed secure mail services to the financial services industry as a whole as well as to companies in other vertical markets.

Recommended Competitor Actions

• Competitors in the hosted messaging and compliance services space can dismiss the acquisition as the purchase of niche solution which is focused entirely on a very small subset of financial services companies. Rivals such as Apptix and NaviSite that also focus on the SMB space can use any questions about the SECCAS deal to outline their own capabilities with respect to providing secure hosted mail solutions while referencing any specific experience that they have supporting customers in the financial services industry.

• Providers such as Symantec that offer secure hosted mail and IM solutions should emphasize their own long histories supporting clients both inside the financial services sector and other industries with services that cover both compliance management and proactive security measures.

• Perimeter eSecurity has a lucrative customer base, along with a solid set of services that make the company a potentially attractive acquisition target. Larger rivals such as AT&T, Qwest, Verizon Business and Sprint should consider whether Perimeter eSecurity could be a worth a closer look, even as a partner.

CLIENTS ONLY

Competitive Positives and Concerns

Recommended Vendor Actions

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