IBM Inks Purchase of Watchfire

| About: International Business (IBM)

IBM announced Wednesday it will buy security and compliance testing software company Watchfire Corp. The purchase price was not disclosed. Watchfire will be integrated into IBM's Rational software brand. A survey conducted by the FBI last year found that internal security attacks cost U.S. businesses an annual $400 billion. Watchfire's technology allows customers to identify and fix weak spots in their software while it is being developed rather than waiting until the products are on the Watchfire logo 07 06 2007market, thus reducing end-user vulnerability to malicious software attacks and spam. The technology is also designed to help customers ensure they are in compliance with legal and industry regulations. Watchfire's 800+ customers include financial services and technology companies around the world as well as governments. IBM Rational software general manager Danny Sabbah: "Watchfire is a recognized industry leader in the security and compliance market that will further strengthen our ability to help customers mitigate risk by integrating security, quality testing and compliance testing requirements early in the software development process -- before vulnerabilities IBM 07 June 2007are exposed." The deal is expected to close in Q3.

Sources: Press release, Reuters, New York Business,
Commentary: IBM Expands Security Software Lineup With Watchfire AcquisitionIBM Forecasts Big Profit Jump by 2010IBM: Playing a Shell Game
Stocks/ETFs to watch: International Business Machines Corp. (NYSE:IBM). Competitors: Microsoft Corp. (NASDAQ:MSFT), Vignette Corp. (VIGN), Electronic Data Systems Corp. (NASDAQ:EDS). ETFs: Internet Architecture HOLDRs (NYSE:IAH), iShares S&P Global Technology (NYSEARCA:IXN), Ultra Dow30 ProShares (NYSEARCA:DDM)
Conference call transcripts: IBM Q1 2007
Related: Watchfire website

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