Symantec Spins Off Web Tools Unit to Focus on Core Business.

By Siobhan Kennedy

Symantec Corp yesterday announced plans to spin off its internet tools business in a bid to better focus on its core security and remote access products. The move, the first restructure under the company's president and CEO of two months, John Thompson, is the start of a new strategy aimed at "unlocking the potential of this company," Thompson told ComputerWire. Thompson, who joined Symantec from IBM in April, said that when he joined the business was essentially divided up into three units: internet tools; remote access; and productivity and security. "My sense was that a lot of the value was captured inside those units and we would be better served if we freed them up to compete independently in their own markets," he said. The network tools division was operating as a self contained, integrated unit in its own right, Thompson said, with its own development, product management, marketing and sales divisions. That's in contrast to the other two divisions, which were only responsible for their own marketing a nd sales; and in many cases to joint customers. "Because of that, we felt they should be the core of what Symantec is," he said.

By spinning off the tools business, Thompson said it would also give the unit a better chance to run at a faster pace in the increasingly competitive web tools space, which Forrester Research predicts will grow to become a $1.4bn market by 2002. The new Symantec Internet company is expected to be formed within the next three to nine months. Although Symantec will initially be the sole stakeholder, Thompson said he expects additional third party investors to come on board in due course. The company will continue to develop and support its flagship VisualCafe product family, and will market the tools to enterprises to enable them to web-enable their business systems and legacy applications. Thompson quotes figures from PC Data, which show that Symantec's tools unit has grown its share of the Java market from 33% to 56% in the past year, ahead of companies like Microsoft, IBM, Inprise and Sun. Although, with Microsoft's announcement this week that it has invested $125m in Inprise, the competition is sure to hot up.

As regards the rest of the business, Thompson added that the aim was to more tightly integrate technology and products from the two remaining units; remote access and security. "I'm not going to be making any organizational announcements," he explained, "the aim is to maximize the potential for using the applications across both consumer and business markets." Currently, he said, the security unit focuses on selling its Norton anti virus product into enterprises but Thompson said he saw "enormous potential" in the market for internet filtering  software, both for businesses and home users. "Most home users, particularly parents, these days are worrying about the suitability of certain URLs, so the logical extension is to help people filter out those unwanted sites," he said. Thompson wouldn't say whether the company would develop its own product or look for a possible acquisition target adding that "we'll make an announcement when we're ready to make an announcement." On the remote access side, the CEO wouldn't say how he intends to expand Symantec's current offering - its flagship PC Anywhere remote access software, although he did say the unit's evolution would go "part in parcel" with its security products.