Security Predictions for 2016 or “Let the internet security prognostication begin”

It’s that time of the year, when security pundits make their security predictions and comment on trends for 2016. Of course, it would be great if the pundits who came out with predictions for 2015 came out with a report card in early 2016. 

Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window - Peter Drucker

Consolidation in the Security Sector

Look for continued security consolidation as some of the larger vendors utilize the strategy that it is quicker and easier to buy a technology to broaden their security portfolio than to develop the technology internally. At the same time, some larger companies will sell off their (incomplete) portfolio of security products to focus on other sectors. There are rumors, for example, about SonicWall being put on the market by Dell.  Of course, FireEye rumors are making the rounds after their Q3 results.

Look for other vendors to analyze the market, do a make/buy analysis and then license missing technology from smaller, more agile, companies.  

“If you think technology can solve your security problems, then you don’t understand the problems and you don’t understand the technology.” – Bruce Schneier

Bubble Will Burst on Some Newly Public Security Vendors

At some point in time, companies have to generate cash and after working through the wonders and options of tax accounting, companies have to show a bottom line profit.  Look for investors getting tired of “but we’re going after market share” and selling their stock. For others, shorting activity will increase.  An offshoot of this is that these companies will become less expensive to acquire. Happiness is positive cash flow.

Splitting (breaking?) of Humpty Dumpty. Symantec and Hewlett Packard

Symantec has retired their vision (several years old) of becoming a widely diversified company (begun by John Thompson) and is splitting/divesting into security focused Symantec, and back up and recovery, SDN, and governance focused Veritas. Hewlett Packard has split into two companies. HP Inc.   holds the printing and personal systems side of the business, selling printers, scanners, displays, personal computers (laptop, desktop, and tablets),  and the supplies and services associated with them.  Hewlett-Packard Enterprise will handle the hybrid cloud, servers, storage, converged systems, networking, management software, and the services necessary to run an enterprise.    They are both Fortune 100 companies, the latter led by Meg Whitman, and the former by Dion Weisler.  Not bad for a company that began in a garage in Palo Alto, selling to Disney.

One of these splits will work out much better than the other one.   That one being….Symantec. HP Enterprises, and HP, Inc. are still battleships.   

Life is a Breach

There will be at least one major security breach, for a number of reasons.  Some companies have still not gotten the memo about cybercriminals, thinking, “It can’t happen to us” and are being slow in their investments.  There are a number of bright cybercriminals out there. They design their own methods of attack.  They may rent use of a botnet as part of their attack strategy.  If the CIO/CEO want to maintain their title, look for full transparency, accepting the blame, laying out the groundwork to prevent this from happening again (hopefully), and protecting their customers. Classic disaster recovery procedure, often not followed.

Cybercriminals Will Broaden Their Target Base

Cybercriminals will increase the number of vertical markets they go after and the size of the typical breach will be smaller. The number of breaches (reported anyway) will decrease. From a CSO Online article - Jody Westby, CEO of Global Cyber Risk, “it is the data that makes a business attractive, not the size – especially if it is delicious data, such as lots of customer contact info, credit card data, health data, or valuable intellectual property.”  http://bit.ly/1BcYw8W

The Identity Theft Resource Center (ITRC) reported in October that there has been 606 data breaches recorded through October 13, 2015, and that more than 175 million records have been exposed.    The top 4 sectors with respects to incidents, business (39%), health care (36%), banking (10%), and government (8%) 68% of the records exposed were in the health care sector. There were over 780 data breaches in 2013.

We Will Continue to be Our Own Worst Enemy

“Companies spend millions of dollars on firewalls, encryption and secure access devices, and it’s money wasted, because none of these measures address the weakest link in the security chain.”- Kevin Mitnick

 A warning from your browser not to visit that site?  A found thumb drive?  New pictures of (fill in the name of your favorite celebrity) on the web or as an attachment to your email.  These are the internet equivalent of wet paint signs. Some people just have to check for themselves. More security aware companies will do more than have people look at a slide presentation on security and take a quiz once a year. They’ll send their own employees phishing emails, among other tactics.

The Wisdom of Crowds

James Surowiecki, in the book “The Wisdom of Crowds”, speculated that large groups of people are smarter than an elite few, no matter how brilliant–better at solving problems, fostering innovation, and coming to wise decisions. In 2016, market share of consumer AV/Malware purchases will probably still continue to be more a reflection of how many “likes” a product receives, rather than how they are reviewed by a PC Publication,  or test organizations AV-Comparatives, or AV-Test. Scary. Whom are you going to trust? Your doctor or your Facebook friends?

A  Growing use of Something Other Than Passwords

The top 20 list of passwords for 2016 may not vary greatly from 2015, look for more people to use some sort of biometrics or Multi-factor Authentication (MFA), to enhance the security of their devices. This will occur in businesses more quickly than in the consumer marketplace. According to an article in CNET at the beginning of the year, the top 10 passwords of 2014 were 123456, password, 12345, 12345678, QWERTY, 1234567890, 1234, baseball, dragon, and football. If your password looks anything like this, or is your pet’s name, change it immediately. There are a number of articles on creative ways of making up passwords or using different figures you can draw on your keyboard. At minimum, consider reading a few articles and select a method that works for you.

“Showtime” - The Government or a Large Security Vendor will take the Offensive

At some point in time, negotiations just aren’t cutting it.  Look for a concerted attack against some cybercriminals, whether they’re independent, being treated with benign neglect in their native country, or being subsidized.  This is despite any negotiations taking place with some countries on an international level. Sometimes the best defense is a good offense.  “The Darknet: Is the Government Destroying 'the Wild West of the Internet?” is a November Newsweek article that’s an interesting read. http://bit.ly/1MR5kAX

Government Takes the Lead in Sharing of Information between Security Vendors

The bragging right for many security companies is how quickly they identify and react to threats, and update their existing customers almost immediately.  They are not going to want to share this information with competitors as quickly.  Look for the government to be the driver in information sharing. One question that arises – how open will this table be for all security vendors or will it be a selective group?   “Senate passes cybersecurity information sharing bill despite privacy fears.” Washington Post, October 27. http://wapo.st/1KFbFIc   

The News of the Death of Endpoint Security Has Been Greatly Exaggerated

To paraphrase a quotation by American humorist Mark Twain.  The reliance of AV/malware products on signature files to detect threats has been declining for years. The endpoint   is the last line of defense. Technologies relying on heuristics are not the whole solution. Look for endpoints to use such techniques as artificial intelligence and machine learning, whether powered at the endpoint or in the cloud to lead the way. Despite statements by Symantec and others, do not look for AV/malware protection provided at the endpoint either installed their or involving technology in the cloud to disappear anytime soon.

Who will be Among the Top New Innovative Security Companies in 2016?

Good question.

On November 3, SINET announced their top 16 innovators (revenues under $15 million) for 2015. These companies were:  Bayshore Networks, Inc., BehavioSec, Gurucul Solutions, Lastline, Netskope, Onapsis, Inc., Palerra, Inc., PFP Cybersecurity, Pindrop Security,  QuintessenceLabs, RedOwl Analytics, Secure Islands,  SecurityScorecard, Sqrrl Data, Inc., TaaSera, Inc., Vectra Networks, Inc., You may be hearing from these companies over the course of 2016. Gartner and others will be coming out with their lists.

A mantra for 2016, “Friends don’t let their friends be mindless about security.”

The Pareto Principle and the Pursuit of Perfect Internet Security – a Parable

Not so long ago, a bright security professional and a firm believer of the Pareto Principle, was tasked with designing and implementing an impregnable security solution for his company’s internet. He did his research and arrived at what he thought was an accurate total cost of $4M. Just prior to striding into his manager’s office for approval, he had a quick discussion about the project with a recent new hire reporting to him about the project.

“I’d be careful,” she advised. “At my last company, we found that each major phase cost 50% more than the previous phase. We had several discussions about ‘risk profiles’ and ‘perfect protection’ before getting buy-in on deliverables and budget on a less ambitious result.” 

The bright security professional thanked her and said, “I’m quite confident in my projections and will stake my job on this project. In fact, I will bring it in under budget.”

So, the bright security professional met with his somewhat parsimonious manager, and guaranteed the results. “In fact,” he said, “the first phase of the project will get us 80% there for only $800k."  The manager said, “Fine, but go over budget on this and your next position will have you saying, ‘Would you prefer a grande or a venti latte?’” and with that, the project was approved.

At the completion of the project, how much under budget was the confident security professional?

First, the Pareto Principle is named after economist Vilfredo Pareto (1848-1923), From Investopedia, “The principle states that, for many phenomena, 20% of invested input is responsible for 80% of the results obtained. Put another way, 80% of consequences stem from 20% of the causes. Also referred to as the "80/20 rule".”

The answer is – the individual left to “pursue other opportunities” when he found himself having exhausted the budget, told his manager  that he now felt that 100% was unobtainable and that  it would cost an additional $2.5M to get to 97.5% protection.

How did this happen?

Earlier, a factor (chosen by me) added by the wise new hire was that each phase of the project was that each phase of the project was going to cost 50% more than the previous phase.

Phase 1 - $800k spent (total $800K) to reach 80% of perfection

Phase 2 - $1.2M spend (total $2M) to reach 90% of perfection

Phase 3 - $1.8M spent (total $3.8M) to reach 95% of perfection

Phase 4 – Plug pulled on project. The estimate was $2.7M (total $6.5M) to reach 97.5% of perfection and you never reach 100%

Some morals of this parable

·         100% is tough, if not impossible, to achieve

·         Know your risk profile and your company’s risk profile when working on security projects

·         Know how to make coffee drinks

Av-Comparatives Summary Report – 2014

For those who haven’t made a habit of downloading and looking at the many test reports  test group AV-Comparatives publishes, their AV-Comparatives Summary Report of anti-virus products has been released.  Some of the products in the test were the company’s internet security offerings. The report lists the winners in a number of categories:

• Overall winner
• Top rated products
• Real world protection test
• File detection
• False positives
• Overall performance 
• Proactive (heuristic/behaviors)
• Malware removal

Congratulations to BitDefender for being product of the year, receiving 3 stars in all the tests! Two other companies achieved this level with their products, Kaspersky, and Eset.

Most of the products tested were “paid” versions, products from Panda, LavaSoft, and Avast being the exceptions.  Among these three, Panda was the “winner”, finishing twelfth overall.  In alphabetical order, the bottom three companies were AhnLab, McAfee, and ThreatTrack Vipre.

This 151 page report also contains an extensive user interface review section of almost two dozen products.  One of the companies on the list even begins with an S.  Sorry. It’s not Symantec.  One of these days, they’ll step up and be tested.

The demise of anti-virus products and companies offering them  is vastly pre-mature.  The endpoint needs protection. The level of protection provided by these products is superior to that provided years ago, when heuristic technology wasn’t in many endpoint solutions, and there were no cloud solutions for the endpoint. Leave your laptop or tablet unprotected at your own risk!

This report demonstrates quite clearly that the market share leaders in the endpoint security space are not necessarily providing the best security nor performance.  Kaspersky, and Eset, are known in the industry but not as much to the public.  But you can buy them online and in some stores.  

BitDefender has an active and successful OEM program for their antimalware engine. Download and take a look at the AV-Comparatives Anti-Virus Comparative Report.  It’s free. And in 2015, do look at their other reports.  You can also go onto their site and view their results from their dynamic  Real World Test.    http://www.av-comparatives.org/dynamic-tests/   

About AV-Comparatives (www.av-comparatives.org )

AV-Comparatives is an independent 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 offers freely accessible results to individuals, news organizations and scientific institutions.  Currently, the  AV-Comparatives' Real-World Protection Test is the most comprehensive and complex test available when it comes to evaluating the real-life protection capabilities of antivirus software

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. 

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.

AVG Technologies - IPO One Year Birthday. Growth Curve or Ski Slope for 2013? Forbes versus Seeking Alpha Contributors

AVG Technologies has now been public for a year.  Their IPO (Initial Public Offering) took place in early February, 2012,  The stock   closed around $13.08 on its opening day last February  on Nasdaq  after targeting an opening day price at $16 plus.   The stock closed  on February 2, 2013  at  $13.14.  These two figures represent a one-year return of 0.38% excluding transaction costs and any dividends paid.  For the first 9 months of their fiscal year, AVG Technologies  revenue was up, but net income was down (not good as a trend).   Over the course of the year, AVG had a low of $9.42 and in December, had a high of $16.38. They have toolbar  deals with both Google and Yahoo.

 A Motley Fool Perspective - February

One worries about the thoroughness of AVG's protection, however, when one sees they've not been very thorough in safeguarding their finances. Current ratio is a quick-and-easy indicator of a stock's health, especially for a smaller company such as AVG which may lack the resources to bail itself out in the long term. With a current ratio of 0.7, AVG is struggling.
But T.M., you might say, AVG could be using its profits to expand, research, etc. etc. Their declining margins,  however, tell another tale: one of a company whose long-term solvency and profitability is in doubt.

 http://beta.fool.com/tmloyd/2013/02/11/world-wide-web-investment-here-today-gone-tomorrow/23612/?ticker=AVG

So what do Forbes contributor Jim Oberweis and Seeking Alpha contributor Eiad Asbahi see for the company? 

3 Slow Growth Small-Caps with Big Potential – Forbes 

Forbes’ numbers are inaccurate in the article.  AVG Technologies has more than 110 million computer users.  While they have been losing share, according to Opswat, they claim an active user base of 143 million users.  Some of this is attributable to 25 million copies of their Internet Security Suite (the paid) product given to purchasers of Huawei (Yes, that Huawei) mobile devices, in India.  

Forbes contributor Jim Oberweis likes AVG for the company’s PEG ratio, growth prospects, and the fact that the free product received a PC Magazine Editor’s choice award.  He likes the Google relationship. See links at the bottom of this blog for relative rankings of the paid AVG Antivirus and AVG Internet Security  solutions. The print article will be in the February 11 issue.

 

http://www.forbes.com/sites/investor/2013/01/23/three-slow-growth-small-caps-with-big-potential/

AVG: Feb 1st Google Policy Updates Threaten AVG's Growth Engine, Signals Steep Downside

In a  January 31 Seeking Alpha article,  Seeking Alpha contributor Eiad Asbahi is forecasting a share price of $8.50 to $10 per share (elsewhere in the analysis, the figures are $7.30 to $10.28).  This is based on an extensive quantitative analysis based on a supposed change that will be occurring in Google’s toolbar policy.   

According to the article, “Google (GOOG), AVG's primary search partner and currently the source of substantially all of AVG's Platform-derived revenue, is on the verge of announcing an update to its toolbar policy, something that has not been widely followed or discussed by market participants.”  This would require companies to make use of “opt-out” instead of having “opt-in” checked automatically on the customer’s behalf.  Opt-in has been a point of consternation among many users of many software packages.

In the article, he mentions Yahoo CEO Marissa Mayer was asked about this policy change.  Her response,   "On the Toolbar change from Google, we'd be remiss to offer comment on another company's product, so I'm not going to comment further there.”  AVG Technologies has a toolbar  agreement with Yahoo as well as Google. Previously, they had been exclusively one company or the other.

Asbahi did some number crunching based on different churn rates for users prior to and after February 1, 2012, an opt-in rate of 65% and per user revenue from Yahoo search bar users at 50% of Google tool bar users.  After all of his number crunching,  his estimates for AVG Technologies 2013 revenue to be between $248M and $287M,  an “ implied market capitalization and target price would between $399M and $569M, or $7.34/share and $10.28/share respectively.” On CNETs download site, AVG averages around a million downloads a week, suggesting major churn.

From a November 1 Financial Times blog,  “J R Smith, chief executive of AVG, admits that being the first in the industry to offer free products has “kind of put us a little bit in a box”, but slowly the company is succeeding in convincing investors that AVG has evolved from offering just hardcore security into other services and platforms”  http://blogs.ft.com/beyond-brics/2012/11/01/corporate-watch-avg-breaks-out

AVG made a buy versus make decision regarding mobile security in November 2010 with a $4.1 million acquisition of Droidsecurity to gain entry into mobile security market. 

AVG Technologies should be reporting their earnings on February 21.    

    

For some comparative reviews of paid antivirus and internet security products by PC Magazine, go to:

http://kensek.blogspot.com/2012/09/best-antivirus-2013.html

http://kensek.blogspot.com/2012/09/best-internet-security-suites-2013-best.html

 

About OPSWAT www.opswat.com    

Founded in 2002, OPSWAT is the industry leader in software management SDKs, interoperability certification, and multiple-engine scanning solutions.

OPSWAT market share reports are available at http://www.opswat.com/media/reports