Competitors sound off on pending NetScout/Network General deal

Industry analysis by Beth Schultz, plus the latest news headlines.

NetScout last week announced its plans to acquire Network General in a deal worth about $205 million.

Set to close in November, the acquisition would bring together two sometime competitors and strengthen NetScout's packet-analysis and application performance management product suite. Network General customers, who have endured a bit of a rocky decade with the vendor, now face another management team. But officials at NetScout, the smaller of the two companies, say they will support all Network General products.

Industry watchers think the move will help both product lines as NetScout approaches network and application management performance from the top down, and Network General with its history in Sniffer technology tackles the same issues from the bottom layers up. The combination should provide a comprehensive set of capabilities to customers, industry watchers say.

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NetScout last week announced its plans to acquire Network General in a deal worth about $205 million.

Set to close in November, the acquisition would bring together two sometime competitors and strengthen NetScout's packet-analysis and application performance management product suite. Network General customers, who have endured a bit of a rocky decade with the vendor, now face another management team. But officials at NetScout, the smaller of the two companies, say they will support all Network General products.

Industry watchers think the move will help both product lines as NetScout approaches network and application management performance from the top down, and Network General with its history in Sniffer technology tackles the same issues from the bottom layers up. The combination should provide a comprehensive set of capabilities to customers, industry watchers say.

"Network General's acquisition of Fidelia last February gives them the application performance story that NetScout was not covering," says Tracy Corbo, senior analyst for IDC. "These companies have found themselves more often in cooperative selling environments because each was approaching the problem differently."

Yet competitors say otherwise.

Douglas Smith, president and co-founder of Network Instruments, sounded off on the pending deal in the company's blog and also coupled the words with some graphics -- showing how Network General has a bit of a checkered past.

Smith writes: "We think coupling high-level aggregated reporting with in-depth packet capture and TiVo-like network analysis is such a good idea that in December 2006 we forged a partnership with NetQoS. Our partnership was the first among network analysis vendors; NetScout’s purchase of Network General is simply the latest company to jump onto the bandwagon. What we offer today, they are promising for the end of fiscal 2009. Both of these companies are among the leaders in their markets, but it seems they’ve lost their way. NG has seen shrinking sales and a patchwork of acquired product offerings that have never truly been integrated – and that was when these technologies were under one roof."

Network Instruments aforementioned partner NetQoS also chimed in. Steve Harriman, vice president of marketing at the performance management vendor, writes in an e-mail: "The lackluster financial performance of both Network General and NetScout demonstrates that their technologies have struggled to keep pace with the performance-first demands of modern enterprise networks. This lack of technology vision has cost both companies dearly and resulted in flat or negative license revenue growth over the last financial year. With NetScout and Network General playing catch-up with their respective technology platforms, their prospects for growth are unlikely to change any time soon, particularly with a complex and time-consuming merger of organizational cultures and technologies now looming. From a competitive viewpoint, we see this acquisition as a direct, if not belated, response to our partnership with Network Instruments."

Schultz is a longtime IT journalist. You can email her or find her here.