Apple likely bought AuthenTec to thwart Samsung

July 28, 2012
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    It’s increasingly obvious that the smartphone industry has turned into a two horse race. Samsung and Apple sold over 75 million smartphones in the past quarter combined, and made an overwhelming majority of the profits in the industry.

    From underdog to world-leader in just two years, Samsung managed to take everyone by surprise, including Apple I’d say. The Koreans have outsold Apple by an impressive 2:1 ratio in Q2 2012, and it’s clear that Tim Cook feels the heat, hence the global legal war between the two companies.

    But the war takes other forms as well. This week, it was revealed that Apple has acquired AuthenTec , a company specializing in mobile security solutions, for $356 million. Some analysts have wondered why would Apple be interested in a company that offers fingerprint sensors, VPN software, and other solutions that have little to do with the consumer market, Apple’s bread and butter.

    It was than revealed that AuthenTec had signed a deal with Samsung just a week before the acquisition, to integrate its VPN software in Samsung’s Android devices. As it turns out, AuthenTec has been moving into the mobile security field for a while now, which is a major issue across the enterprise sector.

    According to ZDNet’s Larry Dingle, Apple is very interested in strengthening its enterprise business, even if, on surface, they appear lased-focused on the consumer market. Moreover, Samsung is equally interested in taking a bite of the sprawling enterprise sector. Dingle says that it was only a matter of time before Samsung would have set its sights on AuthenTec. After all, Samsung’s top brass have stressed that they would increasingly focus on software, including through acquisitions.

    It all boils down to a classic arms race. AuthenTec’s technologies, patents, and people made it a great target for an acquisition from a larger player interested in improving its position in enterprise. Apple executives probably thought that if they won’t buy AuthenTec, Samsung would surely do.

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