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Network Associates: 3.5 million portal users

In part because of Melissa, Network Associates' upgrade portal for PC users, mcafee.com, has registered 3.5 million users.

Network Associates' upgrade portal for PC users, mcafee.com, has registered 3.5 million users, the maker of anti-virus software said yesterday.

The site saw a huge boost in usage after the Melissa virus hit last month. Since then, hundreds of thousands of people have downloaded updates to their anti-virus software from the site, which was launched in December.

Retail sales of virus detection software also jumped in the week immediately following Melissa's release, according to PC Data.

But the heavy Web traffic may be more important to the company as it targets its e-commerce strategy at computer users of every kind.

Srivath Sampath, the Network Associates vice president in charge of mcafee.com, expects a similar traffic boost at year end as users flock to the site to check whether their PCs are ready for 2000.

"Small business and individuals have not even started on Y2K compliance," said Sampath. Even corporate users are using the site, often with the blessing of their IT departments. "It's hard for MIS to do every desktop," he added.

Network Associates isn't necessarily positioning the site for enterprises. "Macafee.com is becoming almost like an IT department for the small business and individuals," Sampath said.

Mcafee.com users are a loyal bunch--43 percent visit the site more than twice a month, and 14 percent come more than four times, the company said.

Zona Research analyst Jim Balderston says that heavy repeat traffic gives the site a base to move into e-commerce.

"They can do partnerships and cross-marketing that other online commerce sites are using, but they're starting with a loyal base," Balderston said.

The mcafee.com site packages anti-virus and PC utilities that Network Associates has acquired in the last two years, particularly CyberMedia, and turns them into applications that can be used over the Net, as opposed to installing them on a desktop machine. The tools include software to update device drivers, remove fragmented files to clear disk storage space, and update software.

The PC portal diversifies Network Associates' offerings in a strategic way, according to Balderston.

"It's about building an online business as opposed to selling security products," he said, and it is a business with good growth prospects as plummeting PC prices draw novice users onto the Net.

"They're going to need help with stuff like driver updates, uninstalls, anti-virus updates, those little nagging configuration things," Balderston said. "Unsophisticated users are going to need some kind of service that allows them to do these rudimentary things without pain."

That's good news for Network Associates, which has been hammered in the stock market of late, falling from above 60 in December to close at 15 yesterday. It has dropped from above 30 only last week after warning Wall Street that earnings wouldn't be up to expectations.

Balderston even thinks a more visible online business would boost Network Associates' stock. "The companies that have the Internet premium in market cap are those who touch end users directly," he said.

To date, mcafee.com has seen no competition in its market. Potential rivals include Network Associates' bitter adversary Symantec, which has its own portfolio of acquired PC utilities.

"We are defining the whole PC management space. Being a first mover is very important," said Sampath. "I think we have a six- to nine-month head start."