MCI deal for NetSec shouldn't affect feds

MCI deal for NetSec shouldn't affect feds

Government customers of NetSec Inc. should not see any immediate changes in the wake of the company's acquisition by MCI Corp., president Ken Ammon said. But the deal will eventually allow integrated networking and managed security services.

'We have had success working with large organizations and supporting their local area assets,' Ammon said. 'This allows us to support end-to-end communications.'

The $105 million acquisition, announced Thursday, is the first by MCI since the troubled telecom company's emergence from bankruptcy. NetSec will be a wholly owned subsidiary and will continue to operate as a separate business unit, Ammon said.

NetSec, based in Herndon, Va., is a managed security service company with a large base of government customers, including the intelligence community and the departments of Labor, Treasury and Agriculture, as well as smaller agencies such as the National Science Foundation, Small Business Administration and Peace Corps.

'We're going to keep doing what we've been doing,' Ammon said. 'Our original enterprise base was established in government,' and the government sector still accounts for the majority of the company's business.

But the acquisition gives NetSec access to MCI's nationwide IP network and will allow NetSec to integrate its security services with MCI's networking services.

'Customers are driving us in this direction,' Ammon said. 'Convergence of services is what government customers are looking for,' as IT security remains a high priority for agencies, while budgets are shrinking.

For MCI, the acquisition offers a chance to expand the scope of its already sizeable government contracts, according to Forrester Research Inc. of Cambridge, Mass.

'MCI's managed security strategy shifts from reselling security services from specialty providers through its channel to pursuing managed security services in-house,' Forrester analysts said.

NetSec's resources will be an asset in competing with such companies as AT&T Corp. in the managed services arena, the analysts said.

About the Author

William Jackson is a Maryland-based freelance writer.

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