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McAfee Gains on Data Loss

The Internet security company aims to plug leaks from smartphones and BlackBerrys.



is going after data leaks from BlackBerrys and laptops.

The company is expanding its portfolio of products designed to tackle the accidental or malicious loss of confidential data through corporate networks, a segment that is now regarded as one of the fastest-growing in the IT security business.

The new network-based product called McAfee Data Loss Prevention Gateway seeks to plug information leaks from gadgets such as smartphones, BlackBerry phones, laptops of vendors and consultants and USB devices that may be temporarily plugged into the corporate network.

The gateway product complements McAfee's Data Loss Prevention host software designed to monitor desktops released in February.

Evidencing companies' growing concern, more that 153 million data records of U.S. residents have been exposed because of security breaches since January 2005, says Privacy Rights Clearinghouse, a nonprofit consumer information and advocacy organization.

Caught in the net have been some high-profile retailers, including

TJX Companies

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and major government and university departments.

TJX reported a massive data breach in January, saying it lost at least 45.7 million credit and debit account numbers.

McAfee's own research shows that 33% of IT decision-makers believe a major data-loss incident could put their company out of business.

"Because of the high-profile data breaches, companies are starting to investigate how they can be more proactive in protecting information on their networks," says Carl Banzhof, vice president and chief technology evangelist. "They know it is an issue."

Shares of McAfee closed Monday's regular session off 16 cents, or 0.5%, to $29.29 Wednesday. The stock has been up about 4.5% in the three months since Jan. 23 and up about 19% in a year.

Companies' concern over their data is likely to translate into big bucks for security vendors. Research firm IDC says this market could grow from $194 million in 2007 to $434.6 million in 2009, representing a nearly 50% compounded annual growth rate.

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However, McAfee's new product comes nearly six months after it bought start-up Onigma for $20 million. In the meantime, rivals


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, and



have gotten a head start.


introduced its competing product, called Information Foundation 2007, in January, while Websense acquired Port Authority,

a company that specializes in information-leak management, for $90 million in December.

Though McAfee was the first among IT security's biggies to go after a private start-up specializing in this market, the company had been bogged down by management and accounting-related troubles that could have possibly contributed to the delay in launching a complete product.

Former McAfee CEO George Samenuk resigned in October as part of an investigation into the company's stock option grant practices, while the company's former general counsel was indicted in February over option backdating.

Earlier this month, McAfee finally found its new CEO in Dave DeWalt, former



executive vice-president.

McAfee's data-loss-prevention product has two components, a host-side product that monitors the desktop and a gateway-side product that blocks data loss from guest laptops, non-Windows systems such as Mac and Linux-based systems, servers and mobile devices.

What sets McAfee's product apart is that companies don't need to have a separate system for managing the information generated by their data-loss-prevention product, thereby simplifying their internal systems, says Kevin LeBlanc, group product manager for McAfee.

"We are talking about a unified management console that fits in with the other products that we may have, like our antivirus or enterprise risk-management products, which is a completely different approach from the point product vendors out there today," he says.

The data-loss-prevention product can also help companies fulfill their compliance requirements, because it can provide proof of internal and regulatory compliance measures to auditors, board members, and other stakeholders, said McAfee.

The host component is currently available, while the gateway product is scheduled for release in May.