AV-Comparatives Real World Protection Test – August to November 2015

Kaspersky and BitDefender topped twenty companies in AV-Comparatives Real World Protection Test, August to November 2015. These companies finished in the top two, receiving three stars. Both had only one compromised file. Six other companies received three stars over the test period.  Eight of the twenty companies in the test received two stars. Default settings were used for all products.

Trivia question – which North America based malware company received three stars?

Four companies merit the Hall of Shame award for the period, garnering one or zero stars. From the bottom up, ThreatTrack Vipre, Lavasoft, Quick Heat and BullGuard.   Banished to a timeout corner   for being in triple digits for wrongly blocked files – Mcafee, ThreatTrack, and Lavasoft.

An informative graphic in the report depicts the range of protection over the four-month period for each product. The top products were extremely consistent, which is what you would want in a security solution.  The bottom products, less so. 

Not all results are being provided because there is no charge for the report. It can be downloaded at http://www.av-comparatives.org/dynamic-tests/. You can also learn more about the test methodology in the fourteen-page report.  The products tested ranged from free antivirus to internet security suites.  Kudos to AV-Comparatives for detailing some of the statistics methodologies used in compiling their report. Your eyes won’t glaze over as you read about this.

As always, the top products may not be top in terms of number of “likes” they’ve received on their respective Facebook pages.  In  the denouement, should one give more weight to independent third party testing, or a fan club?

An interesting article to read by Adam Winn at San Francisco based OPSWAT,  (www.opswat.com) Sorry Symantec - Antivirus is Not Dead .  Today’s antivirus/malware protection utilizes more than just pattern files and heuristics.

Hall of Shame and timeout corners are not part of AV-Comparatives’ formal designations. You can learn about the organization at www.av-comparatives.org

The trivia question answer – none.  McAfee and Fortinet received two stars.

AV Comparatives Performance Test – Impact of Security Software on System Performance Report October 2015

AV Comparatives has released their Performance Test – Impact of Security Software on System Performance Report. Nineteen products were tested. Eleven products received three stars.  The top three products were in order,  Avira, Avast, and Kaspersky.   Congrats to these three!  Products tested were a combination of free and paid, antivirus, and internet security suites.  The hall of shame award for this test  goes to Fortinet and ThreatTrack; both received one star.  Windows 10 systems were used during the test.

Note that this test doesn’t test  an ability to protect against malware. For that, you would have to look at other tests by AV-Comparatives. In a tie-breaking situation between a few products that performed equally well at stopping and removing malware, the performance test could be a tiebreaker. 

To access the and download the report:  http://www.av-comparatives.org/performance-tests/ 

www.AV-Comparatives.org  used  the performance testing suite PC Mark 8 Professional, to measure system impact for the  test.

AV-Comparatives File Detection Test – September 2015

Av-Comparatives prolific team of writers and testers has released their File Detection Test – September 2015. Nine products received three stars. Avira and BitDefender topped the 21 products in the test.   Their false positive rate was only 0.2%. Other companies receiving three stars, in alphabetical order, were Bullguard, Emisoft, eScan, ESET, Kaspersky, Lavasoft, and Panda.  You can download the report  to see the actual order.

ESET, Microsoft, and Panda had zero false positives The hall of shame award for this test goes to AVG Technologies with a false positive rate 32 times larger Avira and Bitdefender, at 6.5%, (139 false positives).

About the AV-Comparatives  File Detection Test

The awards for the File Detection Test were based on a combination of detection rates and false positives.   The File Detection Test assesses the ability of antivirus programs to detect malicious files on a system. It can identify malware attacks from sources other than the Internet, and it  can identify  malicious files already present on the system.

 “With more than 130000 samples in the test, AV-Comparatives uses one of the largest sample collection worldwide to provide statistically valid results”, according to AV-Comparatives’ Andreas Clementi.

ABC Award for the  File Detection Test

The ABC award (Avoids Being Compared) goes to Symantec. The File Detection Test  is one of the core tests the organization performs. Companies cannot choose which of these core tests to be in. It's all or none.  The ABC award is not part of AV-Comparatives’ test   program!

The document can be downloaded at:    

http://www.av-comparatives.org/comparatives-reviews/ 

The  file detection rate of a product is only one aspect of a complete anti-virus product. AV-Comparatives also provides a whole-product dynamic “real-world” protection test, as well as other test reports that cover different aspects/features of the products.  For those interested, you can easily do a deep dive into individual company’s historical performances on tests or sign up for the newsletter.   Check them out.  Other documents are available for download from the AV-comparatives website  (www.av-comparatives.org ) website.

AV-Comparatives Malware Removal Test – September 2015

AV-Comparatives has released the results of their AV-Comparatives Malware Removal Test for 2015. Products tested were a combination of free and paid solutions.  Sixteen products were tested. Five received three stars or the Advanced Plus award. Kaspersky topped the list. BitDefender was third and the three “A’s”, Avast, AVG Technologies and Avira, rounded out the three star recipients.

AV-Comparatives Malware Removal Test

The Malware Removal Test focused only on the malware removal/cleaning capabilities of the products. The report was written with home users in mind and not administrators or advanced users.  These individuals  may have the knowledge and tools for removal of malware on the system.  To compare products for their protection and detection capabilities, you may want to download AV-Comparatives “Real World Protection Test” and “File Detection Test”.

The ABC or “Avoids Being Compared” Award

More data and testing by an unbiased test group help   consumers make an informed decision when selecting products to secure their devices.  The number of likes on a product’s web site doesn’t cut it for security when licensing  a product.  Comparative testing also motivates companies to improve their products.  It’s disappointing when companies decline to be tested.

For the AV-Comparatives Malware Removal Test, the ABC Award or “Avoids Being Compared” Award goes to Symantec, McAfee, and Trend Micro. All three of these companies have solutions with sizeable share in the antivirus/internet security consumer marketplace.  Perhaps they will step up for the next test. McAfee and Trend Micro are usually there. Symantec? Not so much.

The Malware Removal Test  document is located at  http://www.av-comparatives.org/removal-tests/

All of AV-Comparatives’ tests can be found at www.av-comparatives.org

AV-Comparatives Mobile Security Review – August 2015

Austria based AV-Comparatives has released their Mobile Security Review -  August 2015.  This is quite an extensive document, providing a comprehensive review of sixteen security packages running on Android.  The document runs  seventy pages. Ten of the sixteen products are free.  Almost 2400 malicious applications were used in the test.

Mobile security is crucial for both home users (who are constantly checking their mobile) as well as businesses. The BYOD camel has entered its nose into the intranet tent and it’s not going to be removed.  Mobile devices are a major weak spot for network access, as well as a place where data can be accessed. Data stored on the phone can be stolen, as well.    The Global BYOD market is expected to grow at a CAGR of 25.32% from 2014 to 2019 according to a   new market research report published on September 15.    whattech.com market research report  . These devices need to be protected.

AV-Comparatives, while giving each of the products an approved rating, nonetheless found that the there was overall a “significant overall improvement” in the standard of the products.

Four of the  products provided 100% protection:   Trend Micro with no false alarms, BitDefender,   G Data (both with three  false alarms) and Antiy (with five) rounded out the top four.

AVG Technologies  offering trailed all products tested with 98.4% protection and 4 false alarms. Just above AVG Technologies was Sophos with 99.2% protection and 0 false alarms. 

For those who are interested in a tabular deep dive comparison, the first table compares which of 75 permissions are in each of the products. No product had all of them.

The Feature List table compares the products on over forty attributes, broken down into categories including Anti-Malware, Anti-Theft, Anti-Spam, Parental Control, Authentication, Additional Features, and Support. McAfee Mobile Security lacked the fewest, missing only three.  This product drained the mobile battery a bit more than the others did.

A great deal of work went into this document. The Mobile Security Review can be found free (!) at

http: //www.av-comparatives.org/mobile-security/  .  Complete copyright and disclaimer information is contained in the document and more information about test procedures is on the website.

AVC UnDroid Analyser

AV-Comparatives (www.av-comparatives.com) has also introduced a slick malware analysis tool, the UnDroid Analyser that is free to users. It’s a static system for detecting suspected Android malware and adware and generating some statistics about it. Check it out at http://www.av-comparatives.org/avc-analyzer  .

Addendum

 View AV-Comparatives September Malware Removal Test at

Malware Removal Test - September 2015

AVG Technologies Financial Results 2014 – An Alternative View (some quick thoughts on issues for 2015) and AVG ME

AVG Technologies released their financial results in February.  As usual, the focus was on revenue.  Per their announcement,   “Subscription revenue increased 12% to $281.6 million from $250.8 million year over year. Our consumer subscription business grew 11% to $223.1 million and our small business segment by 18.7% to $58.5 million. For the fiscal year 2014, total revenue was $374.1 million”

Looking at the numbers versus fiscal 2013 and Q4 2013 versus 2014 is a little troubling, as a lot of red is involved in the changes.

With the exception of Subscription Revenue, all other figures above were lower in  Q4 and for 2014 overall versus 2013.  Much of the drop in platform derived revenue was expected, however.  The increase in subscription revenue didn’t make up for the decline in platform derived revenue.  AVG’s focus is going to be on subscription revenue.

In the transcript to the press conference, CEO Kovacs commented that, “We have also exceeded a very important user count milestone, as we came in at over 101 million mobile users, to give a total user count reached of 197 million. Both of these are well on our way to the important milestones

Two potential red flags with this.  There may be double counting of users, if a user has AVG product installed on both a smart phone and a laptop.  Also, several years ago, AVG promoted that they had  on the order of 130 million users. This was before they acquired their way into the mobile business (Israeli based company acquisition).   Doing the math, they may have lost, market share on the order of   34 million desktop users.  That’s quite a bit.   How user is/was defined may have changed over the years.  5 million of the additional users were through the acquisition of Location Labs. 

Paid user count for 2014 on the desktop was approximately 19 million.  The means the majority of the consumer base was free, which means zero switching costs and the possibility for churn.

2014 acquisitions by AVG included acquisitions of Locations Labs, Norman Safeground and Winco.  Revenue from these were not broken out separately.

Some Threats for 2015

SMB

In 2014, AVG’s SMB revenue grew by an impressive 18.7% to $58.5 million. On February 24^th, AVG competitor Avast announced their free Avast for Business.  This product is designed to protect small and medium-sized businesses (SMBs) against viruses and cyber attacks.   

Avast pointed out as part of the introduction  that it plans to introduce programs for MSPs and resellers that enable them "to benefit from the power of free." This could pose a risk to AVG’s growth with their SMB product.  To build their presence in the business marketplace, Avast recruited AVG’s VP of Sales and Operations in June, 2014.

In the Desktop and Android Market

• AVG has not tested well in some product tests by well known vendors.  This could impact market share growth.
• AV-Test (www.av-test.org) released a report in December on “The best antivirus software for Windows Home Users”.   AVG’s products tested came in 18 and 22 out of the 27 tested.
• AV-Comparatives (www.av-comparatives.org ) - In AV-Comparatives’ September “File Detection Test”, AVG was awarded 1 star. 18 products were awarded 2 or 3 stars.
• However,  in the AV-Compararatives.org summary report for 2014, AVG  was one of nine vendors to receive a Top Rated designation. Bitdefender won Product of the Year.
• Av-Test (www.av-test.org ) released a report on “The Best Antivirus SW for Android”.  31 products are in the report.  28 products scored higher the free AVG offering that was tested.
• AVG was not part of the AV-Compasrative September “Mobile Security Review”.

To jump start even further installations on mobiles, AVG may need to do something like they did with Huawei  and give away paid AVG product. They did this with   Huawei mobiles in the India market, and with Samsung phones in the UK market. This was a  couple of years ago. 

   

AVG ME

The rumor mill has AVG Introducing “AVG ME”  sometime in the first ½ of this year , potentially as soon as March.   With this product, AVG ME will be providing publishers and advertisers access to validated user data (gathered with customer permission).  Revenue from this is TBD.

The Usual Acquisition Stories

In November, the Wall Street Journal reported that AVG Technologies had been approached by potential buyers.  Nothing has really been in the press about this since then.

http://www.wsj.com/articles/avg-technologies-approached-by-potential-buyers-1415316140

AVG Technologies in Play, an Alternative Look at Q3 Financial Results

The San Francisco Giants win the World Series in even numbered years.  Rumors circulate about AVG Technology being an acquisition candidate occurs in odd number years. Okay, even numbered as well. Couple that with  so-so financial results? You may want to sell, as well.  

Even before AVG went public, there were “always” rumors about them being for sale as the right price.  Companies being mentioned usually included Hewlett Packard and Cisco. Earlier this year, AVAST Software, an AVG competitor, signed a binding  agreement with CVC Capital Partners for a major investment in the company. The investment valued Avast at about $1 billion US.

Other than throwing off cash for the investors, AVG has   been something of a disappointment. The plan was to go public in early 2012  at $16 to $19.  Instead, they opened and closed around $13. AVG’s market cap, as of 11/15 is just under $1 B.

From a technology standpoint, AVG's growth has been through purchase rather than developing things in house. In September, 2014 they purchased Location Labs, a provider of security for mobile technology. http://now.avg.com/avg-solidifies-leadership-in-growing-mobile-security-market-with-acquisition-of-location-labs/

AVG  entered the mobile security market by purchasing the Israeli firm DroidSecurity in late 2010 DroidSecurity had both a free and paid prospect).  They   increased their share by quietly giving the product away on certain Huawei mobile phones in India (That  announcement appeared on the web and disappeared quickly.  Huawei was being investigated in the 2012 time frame  by the US congress for potentially posing a security threat).

In product testing (ability to stop malware), AVG has failed to be one of the leaders. In AV-Comparatives October Real World Protection tests, AVG came in 10th out of 22. In the September, "File Detection Test of Malicious Software", AVG received on star,finishing 20th out of 22.

(www.av-comparatives.org)  In the Virus Bulletin (www.virusbtn.com ) RAP (Reactive and Proactive test), they weren’t in the top 20. ( https://www.virusbtn.com/vb100/rap-index.xml)

On to the financials. AVG Technologies has their headquarters in the Netherlands. They have an office in Ireland.   Those interested can find multiple stories on the “Double Irish” or “Double Irish Dutch Sandwich”, a technique to significantly g reduce US taxes.  Just saying! Apple and a number of US companies are being creative in using this technique.

For those focused only on revenue (hello analysts), AVG’s 9 months subscription revenue and SMB revenue (less than 15% of their business), is up for the first 9 months of 2014 versus 2013. Trailing revenue, Consumer and Total Revenue, and US Revenue, all down.

For those focusing more on  the bottom line, net income, consumer income, Net Income, Consumer Income, SMB Income, and Operating Income are all down for the first 9 months of 2014.

For those focusing on cash, Net Cash provided by operations is down 35% for the first nine months of this year. The data below is from their latest Form 6-K, available on AVG's web site. 

One would have thought that the positive vibes and karma emanating from the SF Giants home ball park (ATT Park) would have rubbed off on AVG Technologies, given AVG’s US headquarters near proximity to the park. Not the case, however.  

An Alternative Look at AVG Technologies’ Q2 Earnings Report

AVG Technologies accounted their Q2 earnings report on July 30.  The stock fell about 13% as the company missed the Q2 revenue consensus of $91 M with revenues of $88 million.  The stock proceeded to drop from $19.65 to $17.10 and they closed the week at $17.05.  To put a long-term perspective on this, AVG went public at around $16 in February 2002, and had a pop.  A negative pop.  Closing the day at just over $13.

Nonetheless, CEO Gary Kovacs stated,  "I am pleased with our continued execution against our long term strategy toward becoming the online security company.”

One problem with the press is that   they will often only look at the company’s most recent earnings report and compare revenue figures to target and nothing else.  Some will do a comparison to the most current quarter versus the same quarter last quarter.  What they should do is a deeper dive into income, cash flow, margins, etc.  The table below compares the first six-month’s figures for AVG, versus the same time frame last year. They should also look at test results from firm's like AV-Comparatives.org av-test.org and Virus Bulletin.  But that's potential material for another blog.

Subscription revenue and SMB revenue for AVG Technologies is up over that period.  Everything else is down.  Even though SMB revenue increased, income decreased.  Revenue decreased across all regions of the world.  Revenue from Google dropped precipitously.  That may be why on August 1, AVG announced that they were extending their partnership with Yahoo.

For those who want to look at cash flow to do their analysis - net cash provided by operations dropped by 37%. 

There is a lot of red in financial trends for AVG year over year.  Pdf’s of AVG Technologies financial results are available at www.investors.avg.com

When Being an “A” Company Rates a “D”. AV-Comparatives Releases “File Detection Test of Malicious Software” Report

Not a stellar performance by three firms beginning with A in AV-Comparatives March “File Detection Test of Malicious Software.”  Avast – 20th, missing 2.3% of the samples.  AVG Technologies – 21^st, misses 2.5% of the samples, and AhnLab 22^nd, missing 11% of the samples.  Baidu broke the A’s stranglehold on the bottom by leading all companies with 111 false positives, followed by Avast with 95.

Sixteen products did receive AV-Comparatives’ three star designation, led by Kaspersky, F-Secure, and eScan, respectively.  Avira, another A company, also received three stars. 

AV-Comparatives takes care to point out that for this test, “Although very important, the file detection rate of a product is only one aspect of a complete anti-virus product.  AV-Comparatives also   provides a whole-product dynamic “real-world” protection test, as well as other test reports that cover different aspects/features of the products”.

 

The “Whole Product Dynamic Real World Detection" and “File Detection Test of Malicious Software”  tests   are both   available on the AV-Comparatives web site, www.av-comparatives.org

One interesting thing about the products tested in this report is that nine of the engines under the hood in testing were licensed from two companies, BitDefender and Avira.  Details are available in the report.  BitDefender  has an overall detection rate of 99.5%.

About AV-Comparatives

AV-Comparatives is an independent not-for-profit organization offering systematic testing that checks whether security software, such as PC/Mac-based antivirus products and mobile security solutions, lives up to its promises.  Using one of the largest sample collections worldwide, it creates a real-world environment for truly accurate testing. 

AV-Comparatives IT Security Survey 2013

AV-Comparatives released their IT Security Survey 2013.  It’s an interesting read for those following consumer antivirus and internet security providers.  Consumer AV and Internet Security providers may want to use some of the results to help them work on their next release instead of feature creep.  I’m going to mention some of the highlights but people really need to download the report

Market Share  

First – congratulations to the market share leaders in each portion of the world.

• Europe – Avast
• North America – Microsoft 
• Asia - Kaspersky
• South/Central America – Avast

In the global battle of the three A’s, the order was the same in every section of the world – (1) Avast (2) Avira (3) AVG Technologies.  Avast finished no lower than third in any section of the world, and Avira no lower than fifth.  AVG Technologies finished eight, eight, eight,  and seventh.  Therefore, Avast wins the Czech crown as well.

With the exception of Symantec finishing in second in North America, neither they nor McAfee fared very well in the market share report portion of the survey. People may want to look at this portion of the report with the market share reports from OPSWAT.

Kaspersky, who has their eyes on overtaking Trend Micro in the overall revenue race, topped Trend Micro in all regions of the world, including finishing first in Trend’s home turf in Asia.  That has to be a major ouch for Trend Micro.  You don’t lose in your own house. 

Testing

The top tests respondents were interested  in were  Malware Detection (83%) followed by “Real World” protection (64%).  Respondents got to pick four.  Engine developers - you now know your priorities.

Confidence in Test Labs

On a scale of 1 to 5, only three labs scored over four with the respondents, AV-Comparatives, Virus Bulleting, and AV-Test.  TopTenReviews was the only lab to score under 2.  Folks, you can remove that link as one of your favorites if you have it there.  People were only to rate labs that they were aware of. 

Confidence in Magazine Reviews

No publication scored over 3.5 on this.  The top 4.  CNET, PC World, Computerworld, and PC Magazine all scored over  3.3, a narrow band. 

What’s Important to You in a Security Product?

The top three, with none over 65% - Good detection rate (without having to be online), good malware removal, low impact on system performance (the gamers speak).  These results may not speak well for pure cloud solutions.  The bottom two – many customizable features (15%), and well –known product/software vendor (5.6%).  Symantec, McAfee, Trend Micro – take a look at your branding budget.  Those billboards on 101 in Silicon Valley may not be doing much for you ;).  People were to pick five out of fifteen.

What Does this Mean for the Vendors? 

Vendors - Detection rate!  Malware removal/cleaning!  Performance!  Nowhere in the survey did users ask for more features.  Customizability scored low.   You may want to rethink adding additional features to your antivirus or internet security product. I’d curtail  the development of the second, third, or fourth internet security suite.

Reduce/remove unnecessary gimmicks from the products (toolbars, registry cleaners, etc) which do not strictly belong on a security product scored six out of fifteen.  Hey, vendors with toolbar (?) checked yes, and/or make removable difficult.  A chance to earn some customer points.  Wait, a second, you revenue share with other vendors such as Google or Yahoo on the toolbar.  Never mind.

So how does   the above correlate to how well a product catches malware?

Another good read is AV-Comparatives Summary Report 2012, issued in December.  The top product – Bitdefender.  Gang, check it out.  The top rated products in alphabetical order were from Avast, Avira, BitDefender, BullGuard, ESET, F-Secure, G Data, and Kaspersky.  Some names for you folks to check out when your subscription is up for renewal or take advantage of a store’s “Free with competitive upgrade!” offer.  You may want to listen to your Facebook friends when it comes down to where to eat.  Unlike when it comes to what antivirus or internet security software to buy.  Trust no one owning a brass monkey. 

Download both reports.  They’re great reading.

About AV-Comparatives   www.av-comparatives.org  

AV-Comparatives is an Austrian Non-Profit-Organization.  They provide 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. 

Getting around those nasty opts-ins – the customer be damned

Nice article about opt-in policies and how companies profit from them.  The article “How to get around the New Google "Opt-In" Policy (In Four Simple Pictures”) also details how Perion’s subsidiary SweetPacks creatively got around an "opt-in" requirement.  The result was    individual’s home pages would continue to show additional advertisements profitable to them and to Google.  A great article by Eiad Asbahi on the effects tighter opt-in policies could have on company revenue.   http://seekingalpha.com/article/1147451-avg-feb-1st-google-policy-updates-threaten-avg-s-growth-engine-signals-steep-downside

 

http://seekingalpha.com/article/1281881-how-to-get-around-the-new-google-opt-in-policy-in-four-simple-pictures?source=yahoo

Fie on companies such as Sweetpacks that would do this.   Read those opt-in agreements, people. Now about those companies that still make it difficult to get out of auto renewal agreements….

AVG Technologies CEO JR Smith Resigns

AVG Technologies' stock fell 11 percent on Friday with the resignation of AVG Technologies CEO JR Smith.  This was the antivirus and internet security vendor’s biggest one-day drop since they went public with their IPO just over a year ago. AVG was downgraded on 3/12 by Morgan Stanley and the stock dropped another  10.3%.  http://finance.yahoo.com/news/avg-technologies-falls-analyst-downgrade-191512922.html

 “JR has been a visionary leader for AVG.  He transformed the company from a small European antivirus company to a successful publicly traded global leader in PC and mobile solutions,” said Dale Fuller, chairman of the supervisory board of AVG. Smith will remain as CEO until a replacement is named.  Chief operating officer John Giamatteo runs day-to-day activities. http://online.wsj.com/article/BT-CO-20130307-715759.html

 

“During my six years as CEO I am proud of what we’ve accomplished: substantially growing the customer base, delivering strong financial performance, successfully leading our IPO and building a world class business and management team,” said Smith in a statement.  http://www.fool.com/investing/general/2013/03/07/avg-ceo-resigns.aspx

Revenue for the fourth quarter of 2012 was $95.2 million, compared with   $74.3 million in the fourth quarter of 2011, an increase of 28%.  For the fiscal year 2012, revenue was $356.0 million, compared with $272.4 million in 2011, an increase of 31%.  User numbers were 146 million at December 31, 2012, an increase of 38 million, or 35%, compared with the prior year.  The company is becoming increasingly more dependent on platform revenue (Google and Yahoo).  http://www.darkreading.com/vulnerability-management/167901026/security/news/240150252/avg-technologies-announces-change-to-executive-leadership-team  Few of the reports on latest revenues have pointed out that net income dropped by about 1/2 in fiscal 2012.

AVG Technologies during  the JR Smith Years

Market Share - The installed base first went up, then market share decreased (on the laptop/PC side) as measured by OPSWAT (hello free Microsoft AV).  At one point during Smith’s tenure, they claimed the fourth largest installed base.  Installed base is up again because of tablet/smartphone installations (in part through deals with Huawei in India, and Samsung in the UK).  Downloads on CNET were close to 2 million weekly for a while.  Currently, Avast is ahead of them, with Avira trailing.  Microsoft is ahead of all three. 

Product Line(s) – The number of products increased during Smith’s tenure to include    parental protection (acquisition), cloud storage (acquisition), mobile security (acquisition, initially), PC Tune-up, and AVG Cloud care.  It’s increasingly more difficult to be innovative in consumer internet security as many firms were offering multiple products each with their own permutations of similar functionality, not all related to security.  Buying versus making is a valid business decision.  AVG Technology was late to the game in adding additional functionality to their suites.  They were late in getting involved in the mobile market. 

Toolbars?  Mixed reaction by the consumer marketplace, particularly when the “yes” option is clicked for you. The internet is filled with instructions on how to uninstall various firms’ toolbars.  Google appears to be encouraging firms to move away from the default being opt-in. More revenue through secure search? Maybe........

Product quality – Not the CEO’s responsibility.  The paid products tended to be middle of the road among those tested.  Sixteen out of twenty in a September 2012 AV-Comparatives test.  Fourteen out of Twenty-one in a late 2012 AV-Comparatives Whole Product Dynamic Real-World Protection Test.  10 pass and 2 fail in the las 12 Virus Bulletin VB100 tests they participated in.  The free product has been a PC Magazine favorite. 

Marketing   - mixed.  “We protect us.”  Bad.  We needs instruction in grammar!  “How many toothpicks to stop a tiger?”  Interesting.  An unlimited cloud storage product with a limit when you read the fine print? Come on, marketing people.  Switch to us for  free.  Been there.  Done that.  Amoeba like Facebook friend creatures?  Frightening. 

Product Churn – The bane of every free product.  When you have zero switching costs, it’s easy to switch to the next product.  Autorenewal? Symantec and McAfee got their wrists slapped $$$ for making it hard to cancel.  Other vendors were better about it. 

AVG has  obtained the usual product certifications  with West Coast Labs  and ICSA.  AVG   won SC Magazine and Info Security Product Guide Global Excellence awards in 2010.  Quiet since then. 

US presence - US headquarters has been a game of musical chairs.  Florida.  Then Boston.  Now San Francisco.  San Francisco doesn’t count as Silicon Valley.  However, the employees are much closer to SF Giants games.  You see the AVG’s products in big box office supply stores like Staples and Office depot.  The number of facings is only a fraction of those of Symantec and McAfee.  Consumer AV is very much an online purchase, unless you’re going for the free paid versions (after rebates), that always appear when people start purchasing tax software. 

The IPO (Initial Public Offering) – This wasn’t a stellar IPO for   AVG when they went public in February 2012.  The target range was around 16 to 18.  The stock closed around $13 on its first day.  Blame the smartest people in the room for less than stellar number crunching.  The current stock price as of March 11, $13.75.  The stock has been as low as in the 9’s and has broken 16.  Praha based competitor Avast filed for an IPO and then cancelled.  Kaspersky has decided not to go public for the time being.  It did take the longest time after the rumor mills started about the IPO.  The date, whether it was going to be on NASDAQ, NYSE, London Exchange, or others.  Stock price as of March 11 - $13.62.

Like many firms, the company has benefited from having a presence in the Netherlands (dual headquarters with the Czech Republic (better beer) and Ireland (that tax reduction thing) http://kensek.blogspot.com/2012/04/double-irish-with-dutch-sandwich-yummy.html   

But then, larger firms just park money overseas.  By sheltering their assets overseas, Silicon Valley companies such as Apple, Google, eBay, and Hewlett-Packard are able to reduce their annual taxes in some cases by billions of dollars, according to a Center for Investigative Reporting analysis of the 50 largest firms’ financial statements filed in 2012.  http://blogs.kqed.org/newsfix/2013/02/13/cisco-apple-hp-oracle-google-avoid-paying-billions-in-taxes/

 

In the end, an AVG (A Very Good) run for Smith.  After all, during his tenure, how many CEO’s did HP have?  How many did Symantec have?  No stories about “escorts” showing up at parties in Las Vegas.  No children being pulled on stage to sing at company all hands meetings.

Czech funk-soul band Monkey Business may now have to find other corporate gigs.