Rival Calls Microsoft's Security Pricing 'Predatory,' 'Ruthless'

Microsoft's low security software prices are putting the entire security software ecosystem at risk, the chief executive of a Florida company said Wednesday.
"That's flat out wrong," he said. "They should have to compete on a level playing field.

"The problem is not about them getting into the security space, it's about them getting into the security space at 'Crazy Eddie' prices," said Eckelberry.

Microsoft answered Eckelberry's claim of predatory pricing with an oblique response. "The market is full of opportunity for all security vendors to play a role in customer security," a spokesman for the Redmond, Wash. developer said in an e-mail to TechWeb. "We believe that Windows Live OneCare and Microsoft Antigen products provide a good value to customers and that all firms should compete to provide good value."

Rivals McAfee and Trend Micro declined comment, and Symantec did not immediately return a call.

"All I want is fair competition," said Eckelberry.

But John Pescatore, research director at Gartner, called Eckelberry's analysis "phony" and said his numbers didn't add up.

"It's hard to call it predatory," Pescatore said. "The actual price you pay [for McAfee and Symantec consumer products] is lower than the numbers he's throwing out. Not everyone pays list price; they get it free for 3 months or 6 months when they buy a PC, or pick it up at retail for $10 on special."

"I think it's aggressive, certainly, but calling it predatory is wildly inaccurate."

Eckelberry countered. "The whole consumer area is a red herring. That's not the big issue. It's the enterprise." That's where the real money is made, he said.

"When I got the Antigen pricing last week, I was floored," he added. Microsoft's pricing of its Antigen line starts as low as $0.65 per user per month for gateway anti-virus defense. This pricing, Eckelberry said, was even lower than the cost of the Antigen line before its maker, Sybari Software, was acquired by Microsoft in 2005.

Microsoft's pricing, which at one point in his blog Eckelberry called "ruthless," won't just drive rivals out of business.

"It has far-reaching effects. If a majority of companies used Microsoft products to protect themselves, and an exploit leveraged, say, an Antigen vulnerability, one targeted attack could bring down a lot of companies," said Eckelberry.

"Stopping Redmond in its march for world domination is for Microsoft's own good," Eckelberry concluded in his Tuesday blog. "Destroying their own developer ecosystem is the worst possible thing they could do. I won't suggest what I think should be done. But something does need to happen."

Sunbelt Software is a Microsoft partner, and according to Eckelberry, "does business with Microsoft." However, the two have clashed in the past. In 2004, after Microsoft acquired anti-spyware maker Giant Company Software, Sunbelt briefly claimed partial rights to Giant's technologies. Microsoft later agreed to provide spyware signatures to Sunbelt through July 2007.

Giant's technology was used to create Windows Defender, the free anti-spyware application for Windows XP that will also be rolled into Windows Vista when that operating system debuts in January 2007

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