On Oct. 4, IBM announced the acquisition of security information and event management (SIEM) provider Q1 Labs for approximately $575 million, according to The 451 Group’s M&A KnowledgeBase. This is at least the third SIEM solution IBM will have established under its umbrella, but potentially also the most expansive solution when it comes to capturing the emerging combination of log management, network monitoring and security monitoring solution space. With this acquisition, IBM plans to create a new Security Systems division led by Q1’s current CEO, Brendan Hannigan.

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This move follows Hewlett-Packard’s acquisiton of ArcSight nearly a year ago, and precedes further consolidation in the space; NitroSecurity was also announced as being brought into Intel’s McAfee last week. With this shakeup, IBM is poised to occupy the fourth spot in SIEM market share, according to the results of respondent interviews for the Wave 14 Information Security Study. HP’s acquisiton of ArcSight makes it the de facto leader of the space, with 6% of in plan implementations also going its way. EMC’s enVision product (RSA) and Symantec round out the top of the pack.

SIEM enterprise market share, 14th security study.

The most recent information security study shows SIEM installations at a fairly mature 53% in use in enterprise environments, with 6% of respondents seeing new implementations in their short-term plans and 18% having SIEM installations on the radar in their longer-term project planning. Thirty-three percent (33%) of respondents see increased spending in 2012 on SIEM solutions, with 60% projecting a flat spend into next year.

What do respondents think of the product IBM has acquired? The trend in responses bends positive:

• “Q1 Labs’ product is very innovative.”
• “[We’ll look at] enVision, Q1 Labs, Symantec.” (In response to a question about spending plans for 2012 for SIEM solutions.)
• “We are in woeful need of consolidation. We are evaluating whether to continue on with enVision or use something new. We did a POC with Q1 Labs, or [we may] go to SecureWorks as a third party.”
• “Just had this discussion; there are others, like Q1 Labs and EMC enVision.” (In response to a question about switching off another SIEM vendor’s product.)
• “The company [Q1 Labs] is innovative. They remain fresh in terms of feature set. They are a small company, and they are subject to being swallowed up! They need to keep the system ‘capable’ at all times, especially keeping up with the patches.”

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• Larger vendors are leading in choice for infrastructure upgrades, points to potential M&A targets
• Forty percent (40%) of organizations are increasing security budgets in 2010
• Sixty percent (60%) of organizations already utilizing cloud-based infrastructure services or intending to do so in the next two years.

New York – February 23, 2010 – TheInfoPro, an independent research company for the IT industry, today released the results of its Information Security Study, which showed that 40 percent (40%) of enterprises are planning to increase their 2010 security budgets. After a year of restricted spending and delayed projects, major infrastructure upgrade initiatives are finally happening for security IT departments. The study shows that enterprises are favoring the safety of one-stop, all-inclusive vendors, and consequently, the data shows Cisco rising as a formidable security provider.

Potential M&A Targets
As organizations embark on a comprehensive infrastructure refresh, Cisco is now leading in vendor selection for SSL VPN, network access control (NAC) and firewalls. Inside the perimeter, however, pure-play security companies still reign supreme, which could potentially point to them as suitable M&A targets in the coming months for the likes of Hewlett-Packard, IBM and other larger vendors.

“Check Point, McAfee and other similar providers would probably be the largest deals in the acquisition pipeline, each a leader in their respective, mainstream technologies, and each with a loyal customer base,” said Ivan Ruzic, CEO of TheInfoPro. “Smaller deals would most likely happen first, meaning that Blue Coat, WebSense and ArcSight could be to a larger organization what 3Com’s TippingPoint technology meant to HP.”

Key Security Concerns for Cloud
The study results, which are based on interviews with 259 organizations within the Fortune 1000 (F1000) and midsize (MSEs) market throughout North America, showed that 60 percent of organizations are already utilizing cloud-based infrastructure services or intending to do so in the next two years. Due to this growth, the largest area of concern for enterprises is how to deal with sensitive data being placed in not only an external cloud environment but also concern for data that is placed within clouds internal to their respective organizations. Nearly three out of four respondents (72%) cited being very concerned or extremely concerned about security in a cloud environment.

“Even with data pointing to a spending rebound, security professionals say they will spend cautiously and scrutinize each priority after many routine infrastructure updates were delayed,” said Bill Trussell, TheInfoPro’s Managing Director of Security Research. “Emerging trends in virtualization and cloud are driving much attention toward addressing data loss more aggressively.”

Enterprises Gear Spending Toward Protecting Data
For 2010, enterprise security professionals indicate that Symantec, McAfee, Microsoft and Cisco will be among the most likely beneficiaries of higher spending. McAfee has eclipsed Symantec as the most frequently cited provider of exciting security products, while Check Point returned to the list after being absent for more than a year.

TheInfoPro’s Technology Heat Index™ is widely regarded as effective measure of user “demand” for a technology, and from a vendor’s perspective, a good indicator of the relative size of the market opportunity. TheInfoPro’s Information Security Technology Heat Index cites event log management as the No. 1 priority in information security IT spending, with data loss prevention (DLP) and NAC ranking next, respectively.

DLP tops the IT projects list as well as the exciting technology solutions list. Security professionals have identified that both Symantec and McAfee are likely to be the preferred DLP vendors. Cisco and Microsoft still lead for NAC. LogLogic and Microsoft are top choices as vendors for event log management. For the first time in two years, NAC has fallen to the third spot, demonstrating that the technology has moved toward more mainstream adoption.

NOTE: Specific vendor data or full report downloads are available by contacting Ashley Pierce at apierce@theinfopro.com.

About TheInfoPro’s Security Study
TheInfoPro’s Information Security Study was conducted between September and December 2009 and takes an in-depth look into key trends occurring across all areas of the information security landscape, within disciplines such as network security, security management and infrastructure security. The study is completed biannually through one-on-one, hourlong interviews with 259 key security decision-makers, including directors of information security, global security managers and infrastructure team managers, within Fortune 1000 and midsize enterprise organizations. The interview results are collected in comprehensive research reports that provide continuous business intelligence within key areas such as technology roadmaps, spending plans and vendor performance ratings.

About TheInfoPro
TheInfoPro is a leading advisory and research firm that provides real-world perspectives on the customer and market dynamics of the information technology landscape by using a unique research methodology that harnesses the collective knowledge and insights of leading IT organizations worldwide. Through a combination of expert advice, actionable analysis and our extensive network of IT professionals, TheInfoPro serves as a conduit between IT decision-makers, technology providers and institutional investors. Founded in 2002 by alumni of Gartner, Giga, EMC and Bell Labs, TheInfoPro is headquartered in New York City. To learn more, visit www.theinfopro.com or email info@theinfopro.com.
info@theinfopro.com.

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