Allot Buys Cloud-Based Security Firm Optenet

Allot Communications (News - Alert) Ltd. this week announced it is buying security company Optenet for $5.5 million.

The acquirer sells deep packet inspection solutions to enable enterprises to enhance productivity, and to help service providers monetize and optimize their networks. The company has been an evangelist about the move to value-based charging models. Value-based charging enables operators to differentiate and charge for different application and content usage; and therefore, offer personalized service plans that best reflect the unique value of different applications and usage patterns to different types of subscribers.

The acquired sells security-as-a-service solutions to large enterprise and service providers around the world. The two companies have been working together since 2013, and have won the business of more than 10 service providers, including five tier 1s, during that time span.

Allot President and CEO Andrei Elefant commented: “In addition to bringing value to stockholders, this strategic move augments our position in the security market, strengthens our network operator value-added services approach, and complements our cloud and enterprise vision."

Security remains a front-and-center concern for businesses, as major security breaches at government agencies, financial institutions, insurance companies, and retailers continue to dominate headlines.

“Though the product market for content security gateways is looking fairly flat for the next couple of years, the SaaS (News - Alert) (software-as-a-service) business is showing strong growth. We are forecasting global SaaS revenue to more than double from 2013 to 2018, from just over $600 million to nearly $1.4 billion in 2018,” Jeff Wilson, principal analyst for security at Infonetics (News - Alert) Research, noted in December.

“A key trend in SaaS is the deployment of mixed environments encompassing both product and SaaS,” Wilson added. “In some cases, companies seek a true hybrid solution with integrated management. And in others, hybrid environments grow organically. In any case, the opportunity to sell true hybrid solutions exists, and the growth potential is explosive.”

The managed security service market was valued at $14.32 billion last year and is poised to reach $31.86 billion by 2019, according to MarketsandMarkets.