The merged Symantec Corp. and Veritas Software Corp. will become a leader in more than a half-dozen product categories. The post-merger Symantec will be not only a dominant security vendor but also a front-runner in backup, recovery and utility computing.

To capitalize on that opportunity, the merged company must integrate two disparate product portfolios, ease investor worries and convince enterprise customers that bringing security and backup together will help them manage their networks more efficiently.

Senior Editor Dennis Fisher sat down for an exclusive interview with Symantec CEO John Thompson and Veritas CEO Gary Bloom at the RSA Conference in San Francisco last week to talk about the challenges and opportunities ahead.

In terms of product integration, what does your priority list look like?

Thompson: We defined at the outset three areas of opportunity, and one of them I think is relevant to our discussion today, and that’s what I call “mail hygiene solutions.”

How do I scan it to see what contaminants are in it? Where did it come from? How do I store it, archive and retrieve it relevant to policies that I have in my organization?

Those are technologies that come from both companies, not just one of the companies.

Our capability is around shaping of the mail traffic, where you can literally eliminate 60 to 70 percent of the traffic that’s considered bad traffic before it even hits the gateway, and then clean it up.

Storing it and backing it up and having an archival policy are things that come from Veritas.

Another one is around what we call the resilient enterprise. When you see a new threat emerging, you can alert the operational tools that manage the infrastructure to do a better job of managing that risk or mitigating the attack consequences.

Being able to take our DeepSight early-warning system and link it to some of the tools like the Command Central capabilities that Veritas has or the backup capabilities that Veritas has is a wonderful opportunity to demonstrate the true value of this merger.

Click here to read more about the Symantec-Veritas deal.

While some of the financial analysts might not get it, our customers get it, our employees love it, our respective boards think it’s a smart idea.

Bloom: Customers are all [saying,] “Tell me the road map. Tell me what I’m going to get and when I’m going to get it.” [As] two companies coming together as leaders in the industry, what more do you want than your customers asking the question of “Let me see where you’re going.”

Once the companies are combined, where do you see your main competition coming from?

Thompson: Both companies had a set of competitors before this transaction, and those competitors will be around after this transaction closes.

The question is, Are we better equipped to compete as a combined company? The answer is profoundly yes.

A lot of the larger players in the industry will look upon what we’ve done and say, “This may be an opportunity to partner more closely with Symantec.”

For some, we will increase the competitive exposure; for others, we will certainly raise the dial on why Symantec would be a better partner. There is no clear-cut answer.

Bloom: The one thing that’s almost certain is that given the size and scope of what we’re doing and our importance in the infrastructure landscape, no one will be able to ignore us one way or the other.

Next Page: Potential obstacles.

You talked about how you’d taken a company that five years ago was known as a very consumer-focused company and built it into a very enterprise-focused company.

Thompson: And it will be more so when we get this transaction closed.

Today, we have about a 50-50 mix in our revenue stream from consumers and small businesses versus enterprise buyers. [After] the merger, it’ll be 25-75. Our business needs to mirror the market.

Our revenue streams need to look like how IT spending occurs around the world. With the capabilities that Veritas brings, we not only have a stronger portfolio, we are not susceptible to any one market vagary or one market collapse.

Bloom: We also look at the kind of talent pool that’s involved in leading the management team in the combined company. It’s a combination of IBM, Oracle [Corp.], HP [Hewlett-Packard Co.] talent.

The list goes on—enterprise-focused companies. That’s the background of most of the individuals that are driving the company forward.

Thompson: What I knew about consumer software you could fit in a thimble before I came to Symantec.

In 27 years, nine months and 13 days at IBM, I may have had a week or two of worrying about the consumer segment. But the reality also is that consumers spend an awful lot of money on software products.

Read more here about data-protection hopes under the Symantec-Veritas deal.

Have you found that the enterprise customers are buying into the notion of integrating security across the enterprise?

Thompson: There’s no question that they want less complexity, less cost in implementation, a better way to determine to what extent they are in compliance with evolving regulations or even internal policies.

The fastest-growing part of our business right now is the integrated security gateway: putting six or seven security applications on a simple Linux appliance and plugging it in. Customers love it. They don’t want to manage all the technologies.

They want to manage the end result, which is the information flow through their environments.

Three years ago, we announced the first integrated gateway security appliance. It had five applications on it. People laughed.

They said nobody buys security that way. Today, there are dozens of integrated security appliances.

It’s my belief that this relationship between Symantec and Veritas is very much similar to what we did three years ago.

People didn’t see integrated security three years ago, and they now are having some difficulty envisioning how security and availability solutions come together.

Is there an opportunity here for more managed services and professional services?

Thompson: I think that is a natural fit with what we’re trying to do. Both companies were investing in building a bigger services business.

The reason people outsource their security needs to Symantec is they’d rather take the few precious skills they have and focus them on building security policies and strategies.

They move the operational risk outside the company to a company like Symantec.

When you put these two companies together, all of a sudden you have practice-based consulting that can focus on security and availability management [and] backup and recovery capabilities, and if the customer decides he doesn’t have the operational resources to handle that, we can handle that for them.

Bloom: The services pull for Veritas has continually been [to] architect a solution to reduce the complexity, driving the utility computing model.

How concerned are you about the moves that Microsoft [Corp.] is making in security?

Thompson: They are very necessary but not sufficient for the needs of the large enterprise. Microsoft has done a remarkable job of getting the market to focus on security, and that’s good. But what [users are] going to want is a security provider who can look across all platforms and deliver a common solution that can run in a Windows environment, a Linux environment, a Unix environment and a variety of proprietary environments.

We’re purpose-built. We’re not distracted by computer games or a losing news network or a variety of other things. All we do is security.

In the consumer space, it’s clear that Microsoft will want to tap into what is an enormous market opportunity. And our view is bring it on.

We’ve got a reasonably solid brand, we’ve got relationships with the channel, we’ve got products that have been rated by industry analysts around the world as the best in class.

So we’re not going to tuck our tails and run from Microsoft. Show up with a product, and we’ll show you how we compete.

Are there any other areas that you see the merged company going after with acquisitions? Are there any other holes in the portfolio you’d like to fill?

Thompson: If IBM didn’t have a hardware business, we might go buy it [laughs]. You’re the first to hear that. But they have a hardware agenda, so maybe not.

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