Why did Intel pay so much for McAfee?

I have been puzzling over this deal for the last day or so. For those who have been at the cottage and not reading the news, Intel is paying a 60% premium for McAfee…yes you read that right McAfee.

Many of the articles on the subject are asking why would Intel want to buy McAfee. Intel is a hardware guy and McAfee sells software. Good question, and I’m sure it has a lot to do with a change in direction for Intel as they see baked in security at the hardware level as the next “big thing” in the mobile market. I’m  not sure I buy into the logic, but for arguments sack lets say that this is a genius move. My question is why did they pay a 60% premium on closing price? Typically companies pay a premium to make it too expensive for rivals to trump their initial bid. This keeps a bidding war at bay…smart business move. I’m just not sure anyone else was as interested in buying them as Intel, and the premium was unnecessary. The other issue that has me scratching my head is why buy when you can partner on this stuff? I must be missing something.

I know this blog is supposed to be about healthcare IT, so I would ask the readers if they think buying mobile hardware with Anti-Virus baked in would affect their decision on which hardware to buy?

Mark

2 responses to “Why did Intel pay so much for McAfee?

  1. Its cool to go off-topic once in a while. But I’m not so surprised at the premium they paid. To be honest I’m more surprised at the fact that they bought McAfee. Terrible software both for consumers & for enterprise. What are they thinking? And like you said, it isn’t even in their industry… hardware vs. software.

  2. I just read a very interesting take on the “Why Intel bought McAfee” that I felt was worth sharing. The argument in this article
    http://arstechnica.com/business/news/2010/09/intels-walled-garden-plan-to-put-av-vendors-out-of-business.ars
    suggests that Intel is looking to turn the AV industry on it’s head. x86 processors would only allow code execution from trusted sources and would secure the computer at the front end, as opposed to the current back end. An interesting thought…anyone want to guess who the “source of truth” would be…ya Intel. As the article suggests, it reminds me of the walled garden approach of the Apple App store.

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