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Cisco drops firewall software

The company bought the Centri firewall in 1997 to aim at the small-business market. But the market has changed quickly.

Cisco Systems, which has grown into a multibillion-dollar company largely through successful acquisitions, has quietly dropped the Centri firewall software, which it bought in June 1997 for $40 million in cash.

The Centri product, which ran on Windows NT, was designed as Cisco's entry into the small-business firewall market. It bought the product from GlobalInternet.com of Palo Alto, California. Cisco continues to market its PIX firewall, a piece of hardware that has grabbed a considerable share of the firewall market and itself was acquired outside Cisco.

Two months after acquiring the product, Cisco announced a new version of Centri, and at the time discussed taking the Centri user interface and using it for the PIX firewall. In addition, Cisco has been building firewall capabilities into its low-end routers since early 1998, which has been a factor in the decline of firewalls as a niche market.

To date, Cisco says, the Centri firewall interface isn't being used in PIX, although one executive hints it might be revived in future products.

Centri was dropped as Cisco was "consolidating resources to focus on certain other areas," said Smita Deshpande, director of marketing for Cisco's security products. "It was just a matter of prioritizing things and looking at the business case on how to optimize resources for the market."

Cisco has a considerably better record with its February 1998 purchase of the WheelGroup for $124 million in stock, but that deal isn't working out so well for Network Associates, which is beefing up its own security offerings as it pushes into network security and management.

WheelGroup's two chief products, NetSonar and NetRanger, have been integrated into Cisco's virtual private network strategy, announced last week. And WheelGroup security consultants continue to operate out of their original base in Austin, Texas.

"The acquisition is going well," said Deshpande. "We're integrating the products into our mainstream product line, which is a complete product line so it's not just point products, but there's synergy between products."

But Network Associates' license to WheelGroup's intrusion-detection and Network-scanning technology has expired, and Cisco has not renewed it, for reasons Cisco won't discuss. Cisco said Network Associates can no longer market software based on the WheelGroup code. Network Associates itself made 1998 acquisitions in the intrusion detection space and still offers products there.

Cisco's jettisoning of Centri counters the common perception that, among large technology companies, the data networking giant digests acquisitions with the best of them. But, there is recent evidence that the perception may not quite equal reality.

In networking circles, it is well known that Cisco had some trouble absorbing its $220 million acquisition of Granite Systems in September 1997. Granite was a startup vendor building chip sets for the gigabit-speed Ethernet switching market--a huge opportunity that Cisco has only addressed with the full force of its sprawling resources in recent months.

Cisco Chief Executive John Chambers has often said that those companies that can acquire and partner effectively will be in a better position moving forward, as the walls that previously separated various markets are torn down by the growth of the Internet and related media technologies.