http://www.forbes.com/2007/07/09/google-postini-email-tech-cx_ag_0709postini... Forbes E-Mail Security Google Buys E-Mail Security Firm Postini Andy Greenberg, 07.09.07, 2:02 PM ET In a bid to ramp up its Web applications for businesses, Google announced Tuesday that it would be acquiring the messaging security company Postini for $625 million. Privately held Postini, based in San Carlos, Calif., serves more than 35,000 companies by encrypting e-mail and instant messaging data and filtering spam. General Manager of Google Enterprise Dave Girouard said in a statement that the acquisition is designed to make Google's online services more secure and more suited to enterprise applications. More than 1,000 small businesses have begun registering for Google's services every day, but the security concerns of larger enterprises have prevented them from using the online offerings. "By adding Postini products to Google's technology, businesses no longer have to choose," he said. "Employees get the intuitive products they want, and the company achieves the security and assurance it needs." Added security is one more step in Google's push into Microsoft's enterprise software market. Since officially launching its Google Apps Premier Edition in February, Google has been competing directly with Microsoft's desktop dominance, offering enterprise level applications online, such as e-mail, spreadsheet creation and word processing for $50 per user per year. Another deal last month with Salesforce.com, a leading vendor of Web-based customer relations management software, also demonstrates that Google is solidifying its software-as-a-service products for business. Google is still playing catch-up in online software security, says Joe Fisher, vice president of product management at the messaging security company Tumbleweed Communications. He points to Microsoft's acquisition of Frontbridge, another messaging security company, nearly two years ago, which added security measures to Microsoft's services like Hotmail. But Fisher says that the deal will also offer Google a new set of monetizable customers among Postini's current clients, more than 11 million individual customers. "Microsoft has sold software very effectively to enterprise for a long time. Google hasn't," Fisher says. "Postini already has a great name in the industry and a broad customer base. So part of what Google gets with Postini is a new level of distribution." The acquisition, which is expected to close in the third quarter, marks Google's third largest buyout. Google paid $3.1 billion for online advertising firm DoubleClick in April, and $1.65 billion in cash for YouTube last October. -- ----------------- R. A. Hettinga The Internet Bearer Underwriting Corporation http://www.ibuc.com/ 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'