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PGP Doesn't Pay For Network Associates
Brian McWilliams, Newsbytes 2001-10-12

Desktop encryption product and Gauntlet firewall up for sale.

As part of a corporate restructuring, Network Associates today said that it will no longer develop its PGP desktop encryption software.

Network Associates said it will seek a buyer for the technology, which it acquired in 1997 from Pretty Good Privacy, a firm founded by PGP creator Phil Zimmerman.

According to a statement at the NAI site, the firm said it will seek buyers "who are best able to support the users needs" and said it will work with the buyer "to provide a smooth transition for existing customers and the acquiring company."

In the meantime, NAI will continue to maintain and support the PGP desktop encryption product, the company said.

The move, announced during NAI's third quarter earnings report, is the result of the firm's decision to dissolve its PGP Security Business.

Besides the end of PGP desktop encryption development, the restructuring entails a similar halt to the firm's Gauntlet firewall products. Other PGP Security products, such as PGP VPN, PGPfire, and the PGP E-Business Server, will be integrated into NAI's McAfee and Sniffer product lines, according to the company.

PGP is the leading cryptographic technology used to secure e-mail messages, files, disks, and network connections. The technology is defined by an Internet Engineering Task Force protocol called OpenPGP.

In addition to NAI's commercial version, the technology is freely available for U.S. citizens' personal, non-commercial use from the Massachusetts Institute of Technology.

PGPmail and PGPfile Encryption retails for around $50. PGP Desktop, which includes a firewall and intrusion detection system as well as e-mail and file encryption technology, retails for around $400.

In February, Zimmerman resigned his position as Senior Fellow with PGP Security, citing differences with the company's "vision for PGP's future."

In a letter explaining his departure, Zimmerman suggested he differed with the NAI over the issue of "back doors" -- technology for enabling third parties such as law enforcement to secretly unscramble PGP-encrypted data.

On NAI's conference call today, during which it announced progress toward its goal of returning to profitability, analysts expressed no surprise about the company's decision to reorganize the PGP Security unit. The dissolution of the business is expected to result in a loss of around 250 jobs.

Last June marked the 10-year anniversary of the 1991 release of PGP to the public.

M.I.T.'s PGP page is at http://web.mit.edu/network/pgp.html .

PGP Security is on the Web at http://www.pgp.com .

Reported by Newsbytes, http://www.newsbytes.com .

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