In August 2021, a merger between NortonLifeLock and Avast was announced.
Mergers are no stranger to cybersecurity. Big companies (especially Avast) take over smaller companies every year. However, this deal has received a lot of attention due to its size. Once completed, it will be the third largest acquisition ever to occur in the industry.
So what does integration mean for Norton and Avast customers? And what does that mean for Internet security as a whole?
What do we know so far?
Norton Live Look It is an American security company with more than 80 million users. They provide antivirus protection, identity theft protection, and a VPN service.
Avast It is a Czech security company with more than 435 million users. They are famous for their free antivirus products but they are also a popular VPN provider.
Once the transaction is complete, Norton will acquire all shares of Avasts for Between 8.1 and 8.6 billion dollars. The new company will be one of the largest providers of security software.
Norton’s CEO will remain in charge, while Avast’s CEO will become the company’s new president. The vast majority of customers will come from Avast and the company will be co-headquartered in Prague, Czech Republic, and Tempe, Arizona. The deal is expected to be completed in 2022.
The transaction is expected to be highly profitable as it provides opportunities for both companies to grow. Norton will be able to market its products to 435 million Avast users, and vice versa.
Each company will also have greater access to the primary market of the other. Avast is expected to become more popular in America as well.
What does integration mean for customers?
It is not yet known exactly what the deal will mean for each company’s existing customers. The most likely outcome is that both groups of customers will benefit from a wide range of services.
Norton is stronger in identity protection while Avast has always primarily focused on privacy. The new company will likely want to combine these disciplines.
It can be said that Avast is famous for its free services. Among the 435 million users, Only 16.5 million users pay Subscription fee. Norton is primarily a paid service but the new company is unlikely to expect free users to suddenly start paying.
The freemium model was very profitable for Avast. The idea behind freemium antivirus software is that eventually a portion of all free users can be persuaded to pay for a premium service.
In other words, the value of the consolidation depends largely on its free user base, and the resulting company probably won’t do anything that would cause those numbers to drop.
What does integration mean for online security?
Mergers are not usually good news for those outside the agreement. While it’s still too early to predict the outcome of Norton and Avast becoming a single company, it does raise a number of potential questions.
Norton and Avast were really big companies. Together, they do not form a monopoly, but every time such a merger occurs, the industry as a whole becomes less competitive.
Over time, less competition usually leads to higher prices. This is not a problem for millions of people who only use free antivirus products. But less competition can also lead to more jobs being reserved for paying customers.
Mergers between antivirus companies also have the potential to prevent innovation. It is reported that the combination of Norton and Avast will result in a file Reducing the number of employees by 25%.
This could not be more than a reorganization. But it could also mean that fewer engineers are trying to find new ways to protect against malware.
If you read antivirus software reviews, you might have noticed that Avast and AVG usually get it identical scores. This is because Avast acquired AVG in 2016. Their identical results resulted from the fact that they are now using the same detection engine.
Norton and Avast will likely continue to offer very different services but if their products become too similar, it could lead to an increase in cybercrime.
Cybercriminals are working hard to bypass antivirus software in their products. This makes it preferable to them when the big antivirus companies start offering identical products.
It allows them to target more people while worrying about fewer antivirus engines.
Other notable integrations in cyber security
Norton’s acquisition of Avast makes sense when viewed in the context of the cybersecurity industry as a whole. Acquisitions are a popular niche, allowing large software companies to significantly increase their user base in a matter of months.
Norton has acquired several companies in recent years. In 2020, they acquired Avira For 360 million dollars. They also purchased VPN provider SurfEasy in 2017. The company, formerly known as Symantec, actually got its name from its acquisition of LifeLock in 2016.
Avast has also been busy acquiring smaller software companies during the same time period. The most notable of them is AVG but they have also acquired Piriform who are the developers behind CCleaner.
While acquisitions are generally considered a negative event, the current level of standardization within the industry does not appear to be detrimental to consumers.
Norton and Avast are still very popular among consumers and respected by security experts. Even after this merger is completed, the new company will still face stiff competition from other major players in the industry such as McAfee and Kaspersky.
Should customers worry?
If you are a Norton or Avast customer, the combination of the two is not necessarily something to worry about. Every company is roughly equal in reputation, and if any significant changes are made to their product line, they are likely to be positive.
However, for the industry as a whole, it’s hard to see how this merger could be beneficial. At best, mergers like these have the potential to discourage innovation and competitive pricing.
At worst, popular products start using identical code which makes life easier, not harder for cybercriminals.
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