COMDEXvirtual: Otellini Pledges Intel Commitment To McAfee Brand, Business Model

Intel President and CEO Paul Otellini Wednesday pledged the chip giant's commitment to the McAfee security brand and business model.

"Our intent is not to change the business model, the sales practices, the terms and conditions, the products, the branding," said Otellini during a keynote session at COMDEXvirtual. "All that stays the same for the foreseeable future."

That is the strongest statement yet by Intel's CEO on his commitment to keep McAfee's brand and the robust McAfee security partner network firing on all sales cylinders. Some partners had expressed concern on what impact the $7.68 billion blockbuster Intel acquisition would have on the future of McAfee's SMB security products.

Otellini, however, said the "deep collaboration" between the two companies to make McAfee's product's "work better" with Intel's microprocessors and silicon spells an upsell opportunity for McAfee solution providers.

"For the resellers I think that allows for an upsell that you don't have today that is better than the one you have today," he said. "So I am fairly optimistic."

Otellini's comments came in a wide ranging 30 minute question and answer session with Intel Vice President Steve Dallman, who oversees the $35 billion processor giant's channel organization. The session is available one the Web from COMDEXvirtual, the online conference hosted by CRN parent company Everything Channel. The show takes place November 16 - 17, and sessions are available on-demand until May 17, 2011.

Intel announced the McAfee acquisition, the largest in the company's 42-year history, in August. At that time, Intel said it plans to run the $2 billion McAfee security business as a wholly-owned subsidiary reporting to Intel's Software and Services Group. The acquisition still faces regulatory approvals.

Otellini's comments should go a long way toward easing partner fears about the acquisition, said Andrew Plato, president and chief technical architect of Anitian Enterprise Security, a Beaverton, Ore.-based security solution provider that does about $1 million in McAfee business.

"This will make people feel more confident to go forward with McAfee purchases," said Plato. "Now they won't feel that McAfee is going to wither on the Intel vine or get gobbled up by the Intel beast."

Plato said he sees "great promise in Intel and McAfee delivering a very integrated and powerful set of security products that take full advantage of Intel's architecture." Furthermore, he praised McAfee as a security company that has shown a "great deal of business acumen and maturity."

"If things keep going the way they are with McAfee, I see that business increasing," he said. "I think there will be greater confidence among myself and my sales reps to continue to put McAfee out there as a (security) option."

NEXT: What About Symantec, Microsoft Security Offerings?

Otellini also reaffirmed his company's commitment to maintaining an open processor architecture supporting competing security offerings from the likes of Symantec and Microsoft. "In terms of other platforms, we will continue to support Symantec Norton and Microsoft," said Otellini. "We'd be crazy not to."

Otellini pointed to his company's acquisition last year of Wind River Systems, which makes the bulk of its revenue from software that runs on chips other than Intel's, as evidence that Intel will maintain an open architecture.

"Most of Wind River's revenue then and now is not based upon Intel architecture," said Otellini, referring to ARM and MIPS architectures. "We didn't change any of that. We maintained their commitment to open architecture. We are doing the same for McAfee." Wind River has retained its own brand and Wind River website after the Intel acquisition in July 2009.

Noting that Intel had been working with McAfee for a couple of years on software-based security, Otellini said that Intel is "very excited" about the deal.

"We began working with McAfee a couple of years ago on projects that take advantage of the hardware and the software," he said. "There are databases in the software that we can use. There are inspection technologies in terms of packet inspection that we can use and marry them into the hardware to create a much more robust environment."

The ultimate goal of the McAfee-Intel collaboration is not to stop a "known pre-existing attack," but to "go to a known trusted environment where the machines are trusted because they are designed to be trusted" -- where "nothing bad can get in there without the user's knowledge and acceptance," said Otellini.

"Until we get to that point, we are really trying to deal with horses that have left the barn," said Otellini using the horse-barn metaphor to describe the constant security threats barraging users. "When we get to that point, we can think about closing the door in a very secure fashion up front."

Otellini said the increasing use of consumer devices like the Apple iPhone is making it more critical than ever to effectively provide an ’overlay of protection.’

"Our Intel employees want to use [Apple] iPhones," he said. "We have to figure out a way to incorporate that because you want to have that flexibility but not put the corporation at risk in terms of data sensitivities. As these things gain in popularity you'll see us working on ways to put an overlay of protection and security into that."

Jeb Carter, president of DefenderSoft, a Dallas, Tex., security solution provider that has been helping customers battle security threats for 10 years, said he sees a seal of approval from Intel McAfee guaranteeing a secure environment as catalyst to significantly grow cloud and SaaS (Software as a Service). "This is going to give cloud users peace of mind," he said.

Carter praised Otellini's no-nonsense commitment to McAfee and its partners. "Otellini's reaffirmation and support of McAfee's branding is great news," he said. "More importantly though is his pledge to stand behind McAfee's strong commitment to the channel. That is going to pay huge dividends as more and more customers look for security as a service."

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