Sunday, April 29, 2012

Double Irish with a Dutch Sandwich – Yummy Way For Corporations to Reduce Federal Taxes

The “Double Irish with a Dutch Sandwich” has been getting a lot more press lately just because of that darned deficit and that Apple uses this technique to help reduce their Federal taxes.  A hundred million here.  A hundred million there.  Soon, it adds up to billions.  Cupertino, California based Apple also routes some  revenue through Nevada, which ultimately saves state income tax they would have pay in California on investment income.  

The link below leads to a graphic showing  how this works using a pair of Ireland subsidiaries. In Apple's case, the subsidiaries are   named Apple Operations International and Apple Sales International. You then route profits  through the Netherlands.  Store the profits in the Cayman Islands/Caribbean or other  friendly tax havens and voila!  It is legal.  

A number  of US firms do this.  Look at a company's  annual report or their web site.  If they have offices/sites in these countries (Luxembourg as well), there’s a good chance that....  It’s great for software firms. It's worth clicking on the link below just to see the graphic explaining everything.

By managing its investments through a subsidiary in Reno, Nevada,  Apple avoids California’s 8.84% tax rate.  In Nevada, there is neither state corporate income tax nor capital gains tax. Apple did prepare a response for the NY Times, defending their practices and talking about their job creation in the US. 

All of the above is legal.  Apple and other companies are just aggressively making best use of applicable tax laws to help minimize the taxes they pay.  In fact, if you are a proponent of discounted cash flow models to help determine a firm’s valuation, minimizing taxes  helps increase  cash flow, which leads to a higher stock price or a higher valuation for an IPO (Initial Public Offering). .  

“The information on 10-Ks is fiction for most companies,” said Kimberly Clausing, an economist at Reed College who specializes in multinational taxation.  “But for tech companies it goes from fiction to farcical.”
According to the article, “In  2004, Ireland, a nation of less than 5 million, was home to more than one-third of Apple’s worldwide revenues, according to company filings."   Apple has not released estimates that are more recent.   Lots of iPods on a per capita basis!

One downside for companies using the above is that when money is sent overseas, it cannot be returned to the United States without incurring a new tax bill.  That’s why firms have been urging Congress to have a “repatriation holiday” that would permit US companies to bring some of their profits offshore back without owing large taxes.

Below is a link to the complete NY Times article.  It’s a great read.  You don’t need to be an accountant to understand it.  The link below will probably even work on an iPad!  Read while drinking an Irish coffee and having a Dutch pastry.   

AV-Comparatives Survey on Smartphone Usage – April 2012

Interesting one-day survey by AV-Comparatives of over 1000 smartphone users globally about how they use their smartphone.  The survey itself comprised about 15 questions.  Some highlights are below.

  • 70% of the respondents never even turn off their phone.  I couldn’t say whether this is good or bad for battery life!
  • 7% of respondents receive over 100 SMS messages per day.  It would be interesting to see the data broken down by age range, since texting seems to be the communication method of choice for this generation.  It could be cost driven.  Or  because it’s a more silent way to communicate and you can control when you want to respond. 
  • The median respondent spends (27%) something less than 20 minutes per day talking on their mobile (median means ½ the respondents are above a certain figure and ½ are below.  It’s different from average).
  • The median respondent (30%)  spends somewhere between 21 and 60 minutes surfing the web on their mobile. 
  • 32% open a spreadsheet about once a day on their phone while 48% never open one. 
I would surmise that the figures would be more similar by country and perhaps sex.  And that the greatest differences would be by age range.  A businessperson would probably tend to talk more on his/her mobile while a teen would tend to text more. A businessperson would have a greater need to look at a pdf file or a spreadsheet.
For the complete results (free), go to the AV-Comparatives website.

About AV-Comparatives

AV-Comparatives is an Austrian Non-Profit-Organization, which provides independent Anti-Virus software tests free to the public.Go to the AV-comparatives website for complete details about the organization, the many tests they perform, and to download copies of test reports.

Wednesday, April 25, 2012

Facebook Announces Antivirus Marketplace – Welcomes Multiple Antivirus Vendors to their Facebook Security Family

On April 25, Facebook announced the Antivirus Marketplace.  The antivirus vendors that will be partners in this and be members   of the Facebook Security Family are -   McAfee, Trend Micro, Sophos, and Symantec, and Microsoft.  As part of this initiative, Facebook’s URL blacklist system, which scans trillions of clicks per day, will incorporate the malicious URL databases from these five vendors. According to Facebook, "Now, all of Facebook’s more than 900 million users will be protected by the combined intelligence of these industry leaders."
This doesn’t mean that the database will quintuple in size.  Undoubtedly, these databases have a great deal of overlap Trend Micro may offer a unique value add to the combined database given their market share in APAC.  Sophos is a pure business play, so their database may offer some unique additions.
Facebook’s Antivirus Marketplace will allow home users to download six-month licenses to full versions of anti-virus software at no charge from Microsoft, McAfee, Trend Micro, Sophos, or Symantec.  These companies will also be part of the Facebook Security Blog. 

There was no mention regarding frequency of updates.  There was also no discussion as to how these particular vendors were selected.  Four of the ten vendors were in OPSWAT’s  Security Industry Market Share Analysis (March 2012)  top ten with respect to market share.  Only Microsoft was in the top five. Avast (market share leader, and preparing to IPO), Avira (second), and AVG Technologies (third, and with a  grammatically interesting(?)  "We protects us" tagline,) were all left on the sidelines.  To learn about current worldwide and North America market antivirus market shares, go to -

What This All Means

For consumers - some additional protection while on Facebook,   free antivirus software for six months, another source to learn about threats.

For Facebook - a good business decision and good public relations as they work on protecting members of the Facebook community.  The “smartest guys in the room”  putting together the valuation for the Facebook Initial Public Offering (IPO),  may be able to add a bit of an uptick to the offering price.

This may be a good thing in light of Facebook’s   recent revenue announcement.  Facebook posted first quarter 2012 revenues of $1.058 billion, up 45% year over year from $731 million.  However, net income was down, at $205 million, from $233 million in the year-ago period.  Facebook cited seasonal trends and stock based compensation for the decline.  Also, Facebook updated their S-1 on Monday.  Like every S-1, not light reading, running over 160 pages.  

For the companies that were  part of this announcement   - Symantec, Trend Micro, Sophos, Microsoft, and McAfee -  some additional revenue, good PR,  they may  become better buds with Facebook than those vendors not part of the announcement, an opportunity to upgrade home users to a paid version of their antivirus product, or a paid version of one of their internet security suites after six months.  Microsoft only has a free version.

This may help Symantec “a bit” to deflect some negative press resulting from their recent earnings announcement.  Their shares took a substantial hit Tuesday after they lowered their fourth-quarter adjusted earnings and revenue outlook.  They cited weaker demand from its business customers.  Part of the hit may also be due to the fact that Symantec is   shifting their business model to one based more on subscription revenue, rather than the traditional model of selling licenses.

Some interesting discussions may be taking place at the antivirus/internet security vendors not part of the announcement.

To learn about OPSWAT, go to

Tuesday, April 24, 2012

SC Magazine Awards Europe 2012 Winners Announced

SC Magazine announced their SC Magazine  Awards Europe 2012 winners  on April 2 at a soiree held at the London Hilton.  Congrats to McAfee for being named Best Global Security company. For all winners - most excellent!  Awards were pretty spread out. There weren’t multiple winners.  Finalists represented in multiple categories were McAfee, Kaspersky, Blue Coat, Symantec, Websense, and Fortinet.

SC Magazine Awards Europe 2012 Winners
  • Best anti-malware solution - M86 Security, M86 Secure Web Gateway 10.1
  • Best content security - Accellion, Accellion Secure Collaboration
  • Best network security – Varonis, Varonis DatAdvantage
  • Best integrated security solution – Fortinet, FortiGate-300C
  • Best IAM solution - Cyber-Ark, Cyber-Ark Privileged Identity Management (PIM) Suite
  • Best remote access - Swivel Secure, PINsafe V3.8
  • Best security management – Websense, Web Security Gateway Anywhere
  • Best SME security solution - Kaspersky Lab, Kaspersky Endpoint Security 8
  • Best enterprise security solution - Splunk
  • Best security solution, financial services - Actiance, Vantage
  • Innovation award – Trustwave, PenTest Manager
  • Best encryption solution - Boole Server
  • Best DLP solution – Symantec, Symantec Data Loss Prevention
  • Best secure transaction solution – IronKey, Trusted Access
  • Best mobile device management – MobileIron, MobileIron 4.5 Platform
  • Best forensics tool - Absolute Software, Computrace
  • Information security product of the year – Veracode, the Veracode Platform
  • Information security consultancy of the year - KPMG
  • Information security vendor of the year - Qualys
  • Information security project of the year - Barclays Bank, ‘Faking it' social engineering awareness campaign
  • Information security team of the year – Barclaycard, Barclaycard Payment Security Team
  • Information security person of the year – Neira Jones, Barclaycard
  • The Rising Star award - David Rook, Realex Payments
  • Best global security company - McAfee

For a list of 2012 SC Magazine Awards 2012 Europe Finalists

To view the 2012 SC Magazine US Winners

Significance of SC Magazine Awards   Europe 2012
  • Third party validation by a leading dedicated security publication
  • Third party validation by peers
  • Marketing/promotional rights for a year, subject to licensing
  • A number of potential marketing/branding/lead generation opportunities for the recipients
 According to SC Magazine UK - panels of industry judges from the highest levels of the information security profession pass judgment on the products and services put before them.  Another  panel of judges that includes the SC editorial team is employed to decide who should win one of the Professional Awards. 

Let the upgrading of the websites, revising  of pdfs, new banner ads, new lead gen campaigns, and modification of slide decks begin. When you visit websites, and they're displaying winners logos, pay attention to the year on them ;) .  These things can take awhile to get off of websites, boxes, presos, et cetera.

Mind the Gap.

Monday, April 23, 2012

Whole Product Dynamic Real World Protection Test – March 2012

View April results at

Original Post has released their latest Whole Product Dynamic Real World Protection Test – March 2012.  An informative document will be updated several times over the course of the year.  What’s even more interesting than  the results alphabetically by vendor  is going online and sorting by performance.  Isn’t that what it’s all about? The numbers below are "percent captured".

  1. 99.8 – BitDefender
  2. 99.8 – G Data
  3. 99.4 – Kaspersky
  4. 99.2 – BullGuard
  5. 98.6 – Qihoo
The above constitutes a bit of reshuffling from the results published in November 2011.  Avast was the top performing free vendor, in the sixth position.  Tencent (85.0), McAfee (88.1), and Webroot (89.3) were the lowest performing vendors in the test.

October Results Whole Product Dynamic Real World Protection Test

  1. 99.6 – G Data
  2. 99.6 – Kaspersky
  3. 99.6 - Qihoo
  4. 99.6 – Symantec
  5. 99.4 – BitDefender

About -

AV-Comparatives is an Austrian Non-Profit-Organization, which is providing independent Anti-Virus software tests free to the public.  For the March 2012 document, go to:

Sunday, April 22, 2012

Riverbed Technology Stock Rolling Down the River

Riverbed Technology (RVBD) stock took a major hit on Friday, dropping 29%  to $19.85 following their earnings announcement on Thursday.      This was close to their  52-week low of $19.48 in October.  Riverbed Technology’s 52-week peak was   around $41 in July 2011. 

This tumble was the most for Riverbed most since its market debut five years ago. As part of the earnings announcement, Riverbed   lowered their forecast for 2012 sales growth, citing the effect of new product introductions.

“The combination of our product transition and a seasonally weaker quarter was challenging,” President and CEO Jerry Kennelly, said on a conference call.   “We continue to feel the unavoidable growing pains associated with becoming a multiproduct company.”

Riverbed announced their Q1 results on Thursday.  “In a seasonally difficult quarter, we completed a major product cycle and achieved results within our guidance range,” stated Kennelly.  Their Q1 revenue of $182 million was 12% greater year over year.  Their net income dropped from $13 million to $7 million, not an auspicious way to start the fiscal year. 

Riverbed is in the Leaders section of  the January 2011  Gartner Magic Quadrant for WAN Optimization Controllers. They rank  higher that the other two companies in the Leaders section, for both Ability to Execute and Completeness of Vision.   Blue Coat Systems and Silver Peak Systems are the other two companies in this portion of the quadrant.

Nonetheless, analysts were not kind to Riverbed on Friday following the earnings announcement.  The stock received seven downgrades,  from Mizuho, JP Morgan, Wedbush Securities, Capstone, Cantor, Oppenheimer, and RBC Capital.

Riverbed may be dealing with some further  financial rapids in Q2. 


Friday, April 20, 2012

A Range of Pops as Three Silicon Valley Firms go IPO This Week

Three firms in Silicon Valley went public with IPOs (Initial Public Offerings) this week, Splunk, Infoblox, and Proofpoint.  All unprofitable.  All fast growing.Was money left on the table, though, with their asking prices?

Splunk (SPLK) is a “big data” company.  Splunk® Enterprise™ collects, monitors, indexes and analyzes the machine data generated by IT applications and infrastructure--physical, virtual and in the cloud.  This machine data   contains a definitive record of all transactions, systems, applications, user activities, security threats, and fraudulent activity.  This data is largely untapped; Splunk helps organizations analyze this data.  Their growth is in part due to its freemium model.  Their first day pop – 109%, closing at $35.48.  They were up another 2% on Friday. 

Infoblox (BLOX) is in the    automated network control space.   Infoblox products automate the business-critical network services required to connect networks, applications, and people.  Gartner estimates that they have about 40% of the DDI market. DDI equals - Domain Name System (DNS), Dynamic Host Configuration Protocol (DHCP) and IP address.  Network acronym soup, so to speak.  Their only profitable year so far was 2010.  Infoblox   stock debuted on the New York Stock Exchange with the ticker symbol BLOX at $22.57, a 41 percent increase over its late Thursday pricing of $16, , and closed at $21.51.  This was a 34.4 percent pop.

Proofpoint (PFPT) is a   security-as-a-service vendor that delivers data protection solutions that help medium- and large-sized organizations protect their data from attack. They've been around since 2002.  Gartner placed Proofpoint in the Leaders Quadrant in its 2011 Magic Quadrant for Secure Email Gateways.  In their IPO priced its shares higher than their initial range, asking $13 a share from investors.  Shares were first offered on the NASDAQ under the ticker symbol PFPT at $16.85, an increase of 29.6 percent, and closed at $14.08, and 8.3% pop over the initial $13 price.

Splunk would seem to be the winner from the perspective of biggest pop.  The flip side is that the smartest guys in the room doing the analysis should  have had a higher asking price.  
You’ve got to look at stories like “The Art of the IPO”, in the Wall Street Journal.  “It's a fine line.  Price your shares too high, and you'll collect a lot of money.  However, the subsequent drop may alienate investors and demoralize your employees.  Price them too low and you'll grab plenty of headlines as your stock soars on takeoff, but you've failed to raise nearly as much as you could have, and the initial buying frenzy may end up costing you some long-term investors.”


Monday, April 16, 2012

AV-Comparatives on Demand Detection of Malicious Software – March 2012

AV-Comparatives ( ) has released their On Demand Detection of Malicious Software March 2012 report. Twenty vendor antivirus (internet security) products were tested. Symantec was not tested as they wished to pick and choose which tests to participate in. Over 291,000 samples were used in the testing. The AMTSO (Anti-Malware Testing Standards Organization at would be pleased! Eleven products received the top rating of Advanced+, or three stars.

The top four products (incentive to download the report) were from

  1. G Data
  2. Avira
  3. Kaspersky
  4. Sophos

These products also had the overall top detection rates, in the same order with G Data the best at 99.7%. The vendors with the lowest detection rates from lowest "up" were Microsoft and AhnLab.

Only one product, from AhnLab, received the lowest rating, “Tested”.

AV-comparatives also tested for false positives. The top five products were from

  1. Microsoft
  2. Eset
  3. BitDefender/F-Secure (tied for 3rd)
  4. BullGuard

Microsoft actually had zero false positives. The false positive cone of shame award goes to Webroot with 428 false positives. Only they and Trend Micro had more than 80 false positives. Something must be going on with how the Webroot scan engine is evaluating samples.

In alphabetical order, internet security vendors in the test: AhnLab, Avast, AVG Technologies, Avira, BitDefender, BullGuard, eScan, ESET, F-Secure, Fortinet, G Data, GFI, Kaspersky, McAfee, Microsoft, Panda, PC Tools, Sophos, Trend Micro, and Webroot.

It’s worthwhile to go to the web site, download and read the whole report to gain insights on the AV-comparatives test methodology. As well as to view the complete rankings! The end of the year report is a good one to read in conjunction with this report as well, since there are details on most of the products that were in this latest report. Congrats to the top performers.

About AV-Comparatives

AV-Comparatives is an Austrian Non-Profit-Organization, which provides independent Anti-Virus software tests free to the public.

Go to the AV-comparatives website for complete details about the organization, the many tests they perform, and to download copies of test reports.