HP Ups Security Ante With Big Data Encryption Company Acquisition

Hewlett-Packard Monday stepped up its enterprise security software offensive by signing a definitive agreement to acquire innovative big data encryption security standout Voltage Security.

Cupertino, Calif.-based Voltage, which protects data without forcing companies to re-architect their applications even in cloud and big data solutions, was recently named a visionary in market researcher Gartner's 2013 Magic Quadrant for data marketing technology.

The breakthrough deal gives HP and its partners a seat at the table with chief security officers, CEOs and boards of directors of major corporations, said Jed Ayres, chief marketing officer for MCPc, a $262 million Cleveland-based national solution provider ranked No. 89 on the CRN Solution Provider 500 list.

[Related: Partners: HP Security Unit Channel Changes Are Opening Door To Big Sales Gains ]

"This puts HP and partners front and center into some of the very topical conversations CEOs and boards of directors are having around things like the Anthem and Sony breaches where you have confidential consumer data that has gotten into the wrong hands," said Ayres. "It gives HP a best-of-breed solution to prevent those kinds of breaches.

Retailers and financial services companies are redrawing the battle lines in the security war by deploying new technology from companies like Voltage, said Ayres. "This technology has major implications for security," he said. "It totally changes how data is protected by large financial companies."

HP said the acquisition will complement its Atalla cloud encryption offering, which includes tokenization technology that is being increasingly used to secure credit card transactions.

HP Security Enterprise Products Senior Vice President Art Gilliland wrote in a blog post that with Voltage, HP plans to "offer customers unparalleled data protection capabilities built to close the gaps" that exist in traditional encryption and tokenization approaches.

"This is particularly important for enterprises that interact with financial payments systems, manage workloads in the cloud, or whose sensitive data flows into Hadoop for analytics, making them attractive targets for cyberattackers," said Gilliland.

With so much at stake, data security has become more than "just an IT issue, but a business imperative and a global security priority," Gilliland added.

Voltage Security's board of directors comprises a number of top venture capitalists, including Ann Winblad, co-founding partner of Hummer Winblad Venture Partners, which manages over $1 billion in capital, and Michael Biggee, managing director of Trident Capital, which has funded a number of security companies that have been acquired by major vendors, including EMC, Oracle, Symantec and VMware.

The Voltage deal comes in the midst of dramatic channel changes in the HP enterprise security business that partners said are setting the stage for dramatic sales gains for HP's enterprise security product portfolio.

Partners, in fact, said they are seeing an increased sales pipeline as a result of a market-rattling channel shift that moves 4,500 top accounts, which were once considered the province of HP's direct sales team to a 100 percent channel sales model. In addition, HP Security is no longer retiring quota on services for its direct sales reps.

Rich Baldwin, CIO and chief strategy officer at Nth Generation Computing, a San Diego-based solution provider and HP channel partner, told CRN that HP has been busy beefing up its security portfolio with a string of acquisitions including ArcSight, Fortify and TippingPoint, and has done well.

However, the HP portfolio is more on the encryption side, Baldwin said. "Encryption is a big part of security," he said. "It's something you have to have. Customers are starting to insist on security."

HP called out its Atalla cloud-based payment and data security solution as one reason for its acquisition of Voltage Security, which Baldwin said makes sense.

"Atalla is one of HP's hottest security products, and probably the reason it bought Voltage Security," he said. "When transmitting payment information, it has to be encrypted. This makes Atalla a more robust offering."

The HP channel changes, which went into effect Nov. 1, are expected to add more than $30 million in sales to HP security partners.

HP said the Voltage Security transaction is expected to close sometime before its second fiscal quarter ended April 30.

Joseph F. Kovar contributed to this story.

PUBLISHED FEB. 9, 2015