Does M&A Activity In Security Hurt Innovation?

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Security is a growing concern for every business in today’s market, which also makes it a big business opportunity. With the trend of mergers and acquisitions seeping into the security market space, big security vendors are only growing larger. It begs the question, are big vendors good or bad for security innovation?

"Symantec or these other big companies are trying to fix everybody's network, and everybody's network is broken in its own special way," said Cambridge, Mass.-based Raytheon BBN Senior Scientist Alex Jordan.

"You need these big, big companies to do -- I think of it kind of as the general security -- some parts of it they can do very effectively," he said.

Boston-based Rapid7's CEO Corey Thomas said it comes down to culture and business model. He said that in his experience, transparency and focus in customer service are much better at smaller companies.

MFS Investment Management's Chief Investment Security Officer Ken Pfeil said that security companies that grow to a certain size forget what it takes to innovate.

"You can't innovate by acquisition. That just doesn't work. It's got to come from within," said Pfeil.

Pfeil said, from a customer perspective, "You typically will get a much better value and a return with, say like, some type of boutique [security] firm."

PUBLISHED MAY 28, 2015