Analyst: Apple bought AuthenTec for enterprise security

By , Jul 27, 2012

The news that Apple bought AuthenTec for $356 million is making rounds today, leading many to speculate that AuthenTec’s technology will help turn into reality Apple’s patented and yet unreleased iWallet and iTravel mobile apps that rely on NFC technology.

One analyst has a different take, saying Apple simply snapped up the NFC and smart sensors maker to keep it from falling into Samsung’s hands, potentially making Galaxy tablets and smartphones more appealing to enterprise customers who above anything demand strong security…

ZDNet‘s Larry Dignan explains that Apple is relying on enterprise sales to alleviate cyclical sales lulls resulting from its longish annual refresh cycle with iOS devices:

The other wrinkle here is that Apple’s product cycles are longer than Samsung’s. As a result, Apple has to bridge device sales until its latest greatest iPhone lands in the September-October time frame every year. That sales bridge is likely to be the enterprise.

AuthenTec’s website says its technology “helps protect individuals and organizations through secure networking, content and data protection, access control and strong fingerprint security on PCs and mobile devices”.

Its encryption technology, fingerprint sensors and identity management software is “deployed by the leading mobile device, networking and computing companies, content and service providers, and governments worldwide”.

Now, the number of iPhones in the enterprise has doubled from a year ago as many businesses defect to iOS and Android over fear that RIM may not be around for much longer.

That being said, Apple would want to build upon its enterprise credibility to make sure Samsung, by far the biggest Android phone maker, doesn’t gain ground in the space.

Apple’s done a lot in terms of iOS security to make iPhones and iPads a viable choice for government agencies and big corporate buyers (though lots remains to be improved)

Android fragmentation is also playing to Apple’s favor:

Another reason Apple’s AuthenTec purchase is notable is that CIOs are already somewhat wary about Android when it comes to security. Why? Android has too many flavors. A company has to secure different versions of Android. That’s a pain. On the other hand, Apple has one iOS and it’s consistent.

I think Apple has learned a lot from its failed acquisition of AdMob, the leading mobile advertising company Google acquired because Apple was moving too slow and was seriously understaffed with people specializing in big acquisitions.

Apple typically acquires small startups for their technology and talent. In recent years, Apple bought fabless chip makers Intrinsity and PA Semi to optimize its in-house designed mobile processors for speed and power consumption.

Apple’s acquisition of mapping startup Poly9, Placebase and C3 Technology led to the creation of own mapping solution replacing a Google Maps backend in iOS 6.

Cupertino also paid half a billion dollars for the Israeli flash memory startup Anobit, presumably to take advantage of its expertise in optimizing flash memory performance, and has recently snapped up mobile app analytics engine Chomp to help with app discovery on the App Store.

What’s your read on Apple’s acquisition of AuthenTec?

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