Symantec dumps application performance management business

Symantec Thursday announced plans to sell its application performance management (APM) business. The business is based on technology Veritas (now owned by Symantec) acquired through its 2003 purchase of Precise Software Solutions. 

Vector Capital, a private equity firm based in San Francisco, has agreed to buy for an undisclosed sum the Precise business, which Symantec developed into its i3 APM offerings. Upon the deal closing, which is expected to happen by the end of the first calendar quarter, the APM business will operate as a stand-alone company called Precise Software Solutions.

For its part, Symantec says unloading the APM unit will help the company better focus and compete for server and storage management customers.

"Selling the APM business will allow the storage and server management team to focus on security and managing information," said Greg Butterfield, interim group president of Symantec’s server and storage management group, in a company statement.

Industry watchers say the sale marks a move by vendors such as Symantec and potentially EMC away from APM to focus more on information management and security. Letting the APM business go could also indicate that Symantec decided to let BMC, CA, HP and IBM focus on business service management, or BSM, which APM technologies underpin. BSM technology lets IT staff relate how the infrastructure and application performances impact the business, and is a common theme among the Big Four management vendors.

But moving away from APM could be a short-term play for Symantec, one analyst cautions.

"If you only focus on the security, risk and compliance segment, then it is OK [to not also have BSM technology] because it is a noncore solution set. And granted that is a big and growing segment, but what happens next? Where is the next billion dollars in growth going to come from? It has to be an adjacent market -- which would be BSM," says Jasmine Noel, principal analyst at Ptak, Noel and Associates.

Vendors like Symantec looking to compete against the incumbent management players will have to have BSM in their portfolio, says Noel, and in that case, moving away from APM could be a short-sighted move or it could make way for a bigger acquisition in that area in the future.

"With the right investment i3 could grow into that [BSM] space. On the other hand, dumping i3 clears the way for another mega-deal between Symantec and one of the BSM vendors, which sounds smart except for the fact that Wall Street hated their last mega-deal [with Veritas]" she adds. 

In a statement, Symantec said it signed an agreement with Vector in which Symantec would continue to sell APM software and support its customers. Symantec also indicated it would continue to honor its commitment to existing APM customers and transition personnel to Precise Software Solutions.

Aprisma Management Technologies experienced a similar fate when it was sold to a holdings company, then acquired by Concord Communications before CA purchased Concord. 

"Those customers that still exist have been extremely loyal through all the strategic neglect because the technology is solid, so my guess is that they will wait to see where the company eventually lands. HP or IBM are safe bets, but if the price is right even Compuware would be interested," Noel says.