Symantec raises stakes

Symantec is shifting focus towards a subscription model for its products, a move which has led to price increases for some of its most popular software packages.

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By  Peter Branton Published  October 23, 2005

Symantec is shifting focus towards a subscription model for its products, a move which has led to price increases for some of its most popular software packages. The shift towards a subscription model reflects the changing times, the security giant claims, with the increasing frequency of threats meaning it is no longer appropriate to simply roll out a product once a year. The subscription model will see users now get regular product enhancements sent out to them as well as the more traditional virus signatures, executives said. “This change reflects what we were hearing back from customers,” said Vikram Suri, Symantec’s country manager for the Gulf and Levant. “The customer, at the end of the day, is only interested in making sure that he is protected securely.” In the US, the move has attracted considerable criticism because it has seen pricing on some products go up by as much as 33%. For the Middle East however, the different pricing structures in place should see that impact considerably lessened, a spokesperson for Symantec said. “Yes, there has been some increase in pricing, but the customer gets a lot of extra functionality for that,” said Suri. “The sophistication and the frequency of threats has gone up considerably in recent years. It is more important than ever before to get your security products updated regularly. We’re offering the customer better peace of mind with this.” The shift towards a subscription model has also been interpreted as being driven by Microsoft’s proposed move into the security software market. This month, Microsoft CEO Steve Ballmer outlined the company’s plan to provide both consumer and enterprise security products (see IT Weekly 15-21 October 2005). Analyst firms have warned that this will prove extremely threatening to the existing security firms. But Symantec executives have been at pains to deny that the move to a subscription model is a response to this threat. Suri said that the move was purely in response to customer interests. Industry analysts, however, believe that Microsoft’s security efforts are likely to have a downward effect on pricing: Gartner estimates that price points for security products will drop at least 10% per year after Microsoft’s entry. The analyst firm is recommending that users avoid contracts of longer than two years duration for desktop security products. A spokesperson for Symantec rival McAfee said it is looking to keep pricing levels of its 2006 products in line with this year.

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