Veritas CEO Makes the Case for Merger with Symantec at Annual User Conference
- By John K. Waters
- May 2, 2005
Veritas Software chief executive Gary Bloom used his keynote at his company’s annual user conference, under way this week in San Francisco, to make the case for the pending merger of Veritas and Symantec Corporation, and to assure his customers that their service would not change.
“For most Veritas customers, you are not going to see a change,” he told his audience. “You’re still going to call the same number, and probably for 99 percent of the people in this room, you’re still going to be talking to the same people you’ve always talked to.”
The Mountain View, CA-based data-storage software maker will continue to develop new and existing products, Bloom said, while moving toward a utility computing model. Veritas spent $174 million on R&D in 2000, he said, and that figure had grown to $347 million in 2004.
“The best way to view Symantec’s strategy in the future is to think of our utility computing strategy with security added to it,” he said.
Bloom characterized the $13.5 billion Symantec buyout of Veritas as part of the evolution of the information age, and he called the deal “a proactive move” that gets the two companies out ahead of an industry consolidation trend.
“An industry event is happening as the information age unfolds and we conduct business electronically,” he said. “We have to protect that asset. Right at the heart of that are Veritas and Symantec together.”
The merger of Veritas, a leading provider of backup, archiving and file-system software, with the Cupertino, CA-based information security giant was announced in December and is expected to close by the end of June. The acquisition is the second-largest deal of its kind in the industry’s history, and it will create the world’s fourth-largest software company, with $5 billion in the bank and expected annual revenues of $5 billion.
“This is only the beginning of the consolidation,” Bloom said. “Availability, disaster recovery, compliance and security all blend together. That is the problem we’re addressing. We’re at the early wave of that trend.”
Other recent IT industry mergers, such as Oracle’s much publicized, $10.3 billion acquisition of PeopleSoft and the pending Adobe buyout of Macromedia for $3.4 billion--are helping to plow up the vendor landscape.
Bloom touted his company’s own M&A history, citing the Veritas acquisition of Ejasent, Invio Software and KVS during the past year. These deals added to his company’s ability to provide utilities to track performance and increase automation in storage-area networks, he said.
“One of the things that happens when you do a lot of M&A activity is people start getting the perception that all you’re doing is buying companies and putting that technology into the marketplace,” Bloom said. “What we’re trying to do, and what we continue to focus on, is delivering one set of tools from one vendor to solve this problem in a heterogeneous world.”
Wall Street appears to be harboring some skepticism about the merger. Since the deal was announced in December, Symantec’s stock has dropped more than 30 percent, and shares of Veritas are down 26 percent.
The Veritas Vision 2005 event is the company’s eighth annual user conference. This year’s show was held in San Francisco’s Moscone Center West. The lineup of keynote presenters included senior execs from Veritas, Symantec, Sun Microsystems, Network Appliance and Quantum Corporation, who addressed this year’s conference theme, “Destination: Utility.” This year’s conference added new Community Labs, a Government Solutions Pavilion, onsite career certification testing and more than 20 Birds-of-a-Feather sessions. More than 45 exhibitors and partners were scheduled to showcase their latest storage, application and server management products on the show floor.
John K. Waters is a freelance writer based in Silicon Valley. He can be reached
at [email protected].