Trend Micro Acquires Cloud Encryption Specialist Mobile Armor

Trend Micro Acquires Cloud Encryption Specialist Mobile Armor

Instead of unplugging for the Thanksgiving holiday, Trend Micro was busy working on an acquisition. Specifically, Trend Micro has purchased Mobile Armor, an encryption specialist that seems to be in growth mode. Here's a look at the deal, which could potentially bolster Trend Micro's cloud computing strategy.

Trend Micro disclosed the Mobile Armor deal earlier today (Nov. 29, 2010). Thanks to tipster Brett Martin of Exigo Group for the heads up. According to the official Trend Micro announcement:

"Mobile Armor’s data protection offerings provide full-disk, file/folder, and removable media encryption for endpoints complementing Trend Micro’s existing data loss prevention, email encryption and cloud encryption products. The acquisition furthers Trend Micro’s leadership in providing data protection and encryption from the endpoint to the cloud for all major customer segments. Small and medium businesses, large enterprises and government organizations will receive unprecedented centrally-managed data protection while benefiting from a more flexible, effective layer of protection by encrypting data no matter where it resides."
It seems like Trend Micro hit all of the key search engine optimization (SEO) terms... from the technology (encryption, cloud) to target business segments (SMBs, large enterprises, government). Financial terms of the deal were not disclosed.

Privately Held, Public Claims

Now here's an interesting twist: Although Mobile Armor is privately held, the company on Nov. 9 disclosed a few financial milestones. Among the highlights for the first three quarters of 2010:
  • A 110% increase in new product revenue compared to same period 2009
  • 65% of YTD license revenue derived from new customers
  • 130% increase in pipeline growth of new opportunities
  • 93% customer renewal rate
In retrospect, it seems like the Nov. 9 press release was Mobile Armor's attempt to raise its visibility and potential valuation -- perhaps to increase Trend Micro's bid for the company or to bring more suitors to the table. Either way, Trend Micro ultimately came calling and the deal is expected to be completed by the end of 2010.

Bigger Picture

The Mobile Armor deal is part of Trend Micro's larger cloud strategy, which includes partner programs for VARs and managed services providers. Already, Trend Micro promotes service provider licensing to small MSPs that want simple recurring revenue business models. True believers include Five Nines Technology, an MSP in Nebraska that leverages Trend Micro's service provider licensing.

Mobile Armor, which offers encryption through the cloud, seems to further Trend Micro's SaaS efforts. And sometime in 2011, Trend is expected to aggressively push online storage to its security channel partners. That effort will revolve around SafeSync.

Of course, Trend Micro isn't the only security company promoting cloud services to VARs and MSPs. Most of the major anti-virus and endpoint security companies have introduced service provider licensing models over the past few months.

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