Intel-McAfee purchase gets EU approval

European Commission antitrust regulators have given regulatory approval to chipmaker Intel's proposed $7.68bn acquisition of security vendor McAfee
Written by Jack Clark, Contributor

European Commission antitrust regulators have given the go-ahead for chipmaker Intel's multibillion-pound acquisition of security specialist McAfee.

The Commission said on Wednesday that it has approved the deal between the Santa Clara, California-based companies, subject to conditions around the potential bundling of Intel's hardware with McAfee's security products.

Security will join those as a third pillar of what people demand from all computing experiences.
– Paul Otellini, Intel

EU regulators were specifically concerned that security software from other companies "might have suffered from a lack of interoperability with Intel CPUs and chipsets", it said.

To allay the EU's concerns, Intel has promised to ensure that rival security vendors will have access to "all necessary information" to use the functionalities of Intel's CPUs and chipsets in the same way as those functionalities are used by McAfee, the commission said in a statement.

In addition, it said it will not "actively impede" competitors' security software from running on its hardware, and that it will not hamper McAfee's security products from running on personal computers containing CPUs or chipsets made by Intel competitors. The chipmaker's rivals in desktop and laptop computers include AMD.

"The commitments submitted by Intel strike the right balance, as they allow preserving both competition and the beneficial effects of the merger," competition commissioner Joaquín Almunia said in the statement. "These changes will ensure that vigorous competition is maintained and that consumers get the best result in terms of price, choice and quality of IT security products."

Strategic purchase

Intel announced plans to acquire security company McAfee in August 2010, in a deal valued at $7.68bn (£4.83bn). At the time, the chip giant said the acquisition would augment its mobile wireless strategy.

"In the past, energy-efficient performance and connectivity have defined computing requirement," Intel chief executive Paul Otellini said in a statement at the time. "Looking forward, security will join those as a third pillar of what people demand from all computing experiences."

Gartner research vice president Leslie Fiering noted that Intel has built security enablement into its processors, but has failed to coax partners into writing specific software for this.

"The point of McAfee is to get a partner that is committed to exploiting these hardware features and using the APIs to access those features in the software," she said. "The idea is not to give McAfee a competitive advantage versus the others, but to make McAfee a showcase of the Intel security features and attract other software vendors."

Separately on Wednesday, Intel announced that it has developed a hardware-based zero-day defence technology. Fiering said that this effort was "absolutely" the type of thing Intel would like to see the security industry work on.

The McAfee buy was given the green light by the US Federal Trade Commission on 21 December.

The antitrust ruling was initially expected to arrive by the end of 2010, but after a preliminary EU investigation, it was moved to 12 January. It was then shifted to 26 January to allow Intel to submit commitments, which can cover assets sales or other promises, to the Commission.

The chipmaker responded to the Commission's decision by saying it expects to close the acquisition before March. "Intel is pleased to have this last approval process behind it and is comfortable with the terms outlined in the agreement with the EC," it said.

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