EMC Acquires ConfigureSoft

| May 29, 2009 | Enterprise Security | Competitive Intelligence Report

| Analyst: Andrew Braunberg

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

Event Summary

May 27, 2009 – EMC has announced that it has signed a definitive agreement to acquire privately-held Configuresoft, Inc. The transaction is expected to close in June, subject to customary closing conditions and is not expected to have a material impact to revenue or EPS for the full 2009 fiscal year.

Analytical Summary

• Current Perspective: Positive on EMC’s acquisition of Configuresoft, because it brings needed server and desktop configuration management and vulnerability management technology in house (EMC has been OEMing the Configuresoft technology for about a year). The deal is timely for Configuresoft, which increasingly has found itself going head to head with much larger vendors, such as BMC and HP.

• Vendor Importance: High to EMC’s configuration management business, while only moderate to the company’s security business. Configuresoft will find a home in EMC’s Resource Management Software Group but the RSA team will certainly have much to talk to Configuresoft about as well. Configuresoft has always positioned itself as a security vendor with deep roots in the vulnerability management market.

• Market Impact: Moderate on the security markets, but only in the longer term. EMC is in the early stages of integrating its networks, storage and systems management products with its security management products, but as these disciplines continue to merge into broader risk management suites, this deal will take on increased importance from a security perspective.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

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Recommended Competitor Actions

• Leading IT management vendors, such as BMC, CA, HP and IBM, should increasingly view EMC as a major competitor in this market if they haven’t taken that view already. These vendors should assume that EMC will continue to build out its suite, both through acquisition and better integration with other products in its portfolio - particularly RSA products. EMC is well positioned to differentiate its offerings based on security management capabilities.

• Configuresoft’s traditional security competitors in the vulnerability management market were Patchlink (now Lumension) and BigFix. Both of these companies have been making news lately in different markets, however. Bigfix has had recent success in OEMing its Unified Management Platform to the likes of IBM and Trend Micro. Lumension continues to extend its portolio and has moved into the endpoint protection and data (device control) protection markets.

• Tripwire should position this deal as a strong technology endorsement of its strategy to combine virtual and physical server change management. Tripwire is in a similar position as Configuresoft, however, with regard to size relative to BMC, CA, HP and IBM. The good news is that Tripwire is partnered with all of those players. The company should continue to asset possible exit strategies in light of continued market consolidation.

Recommended End User / Customer Actions

• Existing Configuresoft customers should be very pleased with this deal because it will protect legacy technology investments in Configuresoft technology. EMC is a safe haven for Configuresoft’s technology and EMC has the resources to keep the products well supported.

• Existing EMC customers should also be pleased with this announcement, particularly customers of the OEMed Configuresoft products. By taking ownership of the technology, EMC can better drive its development and it has more incentive to invest in tight integration with its broader management portfolio.

• Enterprise customers should consider EMC a real player in the IT configuration management, change management and compliance management markets. Prospects that still consider EMC’s management capabilities to be limited to storage management have clearly not been paying the company enough attention.

• Existing Configuresoft and EMC Smarts customers should look to EMC for guidance on any product rationalization that might be required within the Smarts product family as a result of this acquisition.

CLIENTS ONLY

Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

| Client access - More reports in Enterprise Security | More information

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