Shares of software developer Adobe Systems (ADBE) rose sharply following news from computer giant Apple (AAPL) that could lead to widespread adoption of Adobe's Flash software on the iPhone, iPad, and iPod Touch. Apple has relaxed restrictions on developers regarding the use of third-party software, such as Flash, in the operation of applications for Apple's portable devices. For security reasons, Apple, in the past, had been unyielding in its policy that any software used to create applications for its portable devices must be written to run directly on the operating system and not through intermediary software, such as Flash. Google (GOOG) had similar security concerns last month, and it stopped offering some wallpaper applications for phones running on the Android operating system.
With the increasing number of devices, from iPods to TVs to ATMs, that contain embedded communication links, online security has become a major issue. The main worry is that the intent of virus authors has changed dramatically in recent years. Whereas viruses in the past were mostly just a major nuisance, modern versions are written by professionals instead of amateurs, and are often financed by criminal enterprises or cybercrime rings.
Recent high-profile security breaches show just how vulnerable society is to cyberattacks. Every time a computer connects to a network and communicates with other computers, the user is taking a risk. Unfortunately, most governments around the world already have their hands full addressing other 21st century challenges. As a result, the private sector has come through with solutions, but it seems as though it is getting harder and harder to detect viruses.
The shear number of companies now addressing communications security underscores the growing seriousness of the threat. The space has for so long been dominated by just a few firms, like McAfee (MFE) and Symantec (SYMC). But smaller participants such as ESET, CommTouch Software (CTCH), Check Point’s (CHKP) Zone Labs, and Kaspersky Lab, which makes the engine that powers software sold by Juniper Networks (JNPR) and Blue Coat Systems (BCSI), are gaining some notoriety. Even Microsoft (MSFT - Free Analyst Report) has entered the fray with a free offering called Security Essentials that is surprisingly effective. Even companies that have not traditionally operated in the security segment have joined the party. Last month, Intel (INTC - Free Analyst Report) made a bid to buy out McAfee at a generous premium.