Microsoft's security product hits home stretch

Windows OneCare Live marks Microsoft's long-anticipated entry into the consumer antivirus market, which has been the domain of specialized vendors, led by Symantec and McAfee. Two years ago, Microsoft announced its intent to offer antivirus products when it bought Romanian antivirus software developer GeCad Software.

The Redmond, Wash., software giant plans to release the final version of OneCare before summer and to charge about $50 a year for the product, sources familiar with the company's plans said Monday. The company is scheduled to announce the pricing and availability details later this week, they said. A Microsoft representative had no immediate comment.

OneCare combines antivirus, anti-spyware and firewall software with back-up features and several tune-up tools for Windows PCs. Microsoft announced its plans for the service in May. Invited testers have been trying it out since last July, and a public test version was released late last year.

Current OneCare testers will receive a steep discount on the final product, sources said. As a thank-you for test driving OneCare, Microsoft is expected to give a 60 percent discount to beta testers, they said.

Microsoft will sell OneCare purely on a subscription basis--a change from the traditional box-based way of selling security software. Symantec and McAfee sell their boxed security suite products for $69.99, before any rebates, and then charge an annual renewal fee. However, both security incumbents have also been moving to a subscription model.

In addition to adding subscription options, traditional security software sellers have prepared for Microsoft's entry into the market by adding anti-spyware to their security suites. Symantec later this year also plans to introduce a security product, code-named Genesis, that will be sold on a subscription-only basis and has many of the same features as OneCare.

The global antivirus market is growing; it reached $3.7 billion in revenue in 2004, up 36 percent from 2003, IDC said in December. The market research outfit forecasts the antivirus market will grow to $7.3 billion in 2009.

With OneCare, Microsoft is targeting consumers, especially those who do not run security or have let their current product expire. It believes 70 percent of consumers fall into that category. In a recent research note, analyst firm The Yankee Group estimated the niche as a market worth potentially $15 billion.

The company plans to include Windows Defender, an anti-spyware program, within Windows Vista, the update to the operating system planned to arrive before the 2006 holiday sales season. However, there are no plans to bundle antivirus software in Vista. And given that it's expected to come out this summer, OneCare will launch before the update.

Microsoft is also eyeing the enterprise security market. It is working on a new Microsoft Client Protection product to defend business desktops, laptops and file servers against malicious code attacks.