Cisco Improves Self Defense Moves

Cisco Systems acquired security monitoring provider Protego Networks in a $65 million cash deal Monday, one of a flurry of year-end mergers and consolidation among software providers in the past week.

The privately held Protego, based in Sunnyvale, Calif., makes security monitoring and threat management appliances for small-to-medium business networks. Cisco said the purchase will help extend its self-defending network initiative by integrating Protego into Cisco's Security Technology Group.

Cisco said it would pay about $65 million cash for the Protego acquisition, which is expected to close in the second quarter of Cisco's fiscal year 2005 (January 29, 2005).

The deal would add an endpoint to yet another year of Cisco's strategic shift in providing a menu of security management systems to its large and smaller business customers. Last year, it purchased intrusion detection software maker Okena for $154 million in stock as part of its focus.

Protego's products include appliances that monitor networks for threat management and help administrators' decision-making regarding effective use of network and security devices. It does this, the company explained, by combining traditional security event monitoring with network intelligence, context correlation, vector analysis, anomaly detection, hotspot identification and automated mitigation capabilities.

San Jose-based Cisco is the latest major technology company to jump into software purchases in the past week. Oracle's successful quest to purchase PeopleSoft for $10.3 billion signaled not only consolidation in the industry, but was soon followed by a consolidation among security and storage providers, such as Symantec's $13.5 billion purchase of storage play Veritas. .

Protego and Cisco were partners before the acquisition: Protego is part of Cisco's AVVID program (Architecture for Voice, Video and Integrated Data). It works with Cisco to sell integrated security products to customers as they deploy new networks.