Hewlett-Packard will buy enterprise security company ArcSight for $1.5 billion. The Wall St. Journal has more:
(The purchase continues the HP) spending spree that began after Chief Executive Mark Hurd resigned last month. The deal also represents the latest purchase of a smaller security firm by a huge technology company, a trend some see continuing as big tech considers the importance of adding security to their product portfolio. ArSight makes software that monitors corporate networks for unusual activity, such as a hacker’s attempt to break into a system.
The ArcSight deal continues H-P’s push into software and other areas outside of its core computer-hardware businesses that began under Hurd. Software, networking, storage and services–all areas in which H-P has expanded recently–have higher margins than the company’s core personal-computer and server-system businesses. H-P executives have said repeatedly that the company will continue the expansion strategy.
“This purchase,” Jefferies analyst Katherine Egbert said, “could spur the large software, systems and hardware vendors to assess the importance of IT security to their product portfolio, thereby possibly sparking a wave of consolidation–like what happened several years ago in the [business intelligence] and analytics area.”
HP also recently bought enterprise storage company 3Par, winning a bidding war against Dell.
HP’s deep pockets will also serve it well in the legal war it started last week with former CEO Mark Hurd.