Microsoft Buys Israeli Cloud Security Firm for $250 Million
In a deal reported on earlier this summer but not confirmed until yesterday, Microsoft has purchased Tel Aviv-based cloud security firm Adallom. Reports over the weekend put the purchase price at $250 million, contrary to earlier reports stating that Microsoft had paid more than $300 million. Adallom is a startup that helps companies protect data stored in the cloud.
The companies are banking on the growing popularity of cloud services and the trend toward moving critical apps out of in-house data centers, forcing vendors to offer more advanced management tools.
Adallom will continue to sell its security tools while the two companies work to integrate Adallom’s technology into Microsoft’s cloud security suite. The plan is to eventually have Adallom’s technology complement services available for Office 365 and the Enterprise Mobility Suite, including Microsoft’s recently released Advanced Threat Analytics.
We reached out to Paul Burns, founder of IT analyst firm Neovise, who told us that Adallom's technology and solutions will enhance security for organizations that use SaaS applications.
"Organizations that use SaaS have had to rely mostly on the service provider for security," said Burns. "After all, their IT departments don’t have direct control over these services, which are delivered from the service provider’s data center."
Burns said that Adallom puts some control over security back in the hands of cloud customers. "This way customers can decide what level of visibility, governance and protection they want to apply to all their SaaS applications," he said. "Even when a SaaS application would normally allow a specific behavior, such as extracting large amounts of data, Adallom can prevent it."
Adallom, which has 80 employees, was founded in 2012 by Assaf Rappaport, Ami Luttwak and Roy Reznik. According to the company’s Web site, Adallom is an abbreviation of the Hebrew saying "Ad Halom," which in game theory jargon means "the last line of defense."
The firm makes tools that give businesses more insight into how workers are using cloud services such as , Box and Office 365. Adallom’s offerings limit access to certain applications, identify risky employee behavior and issues alerts whenever it detects unusual usage patterns that might indicate data breaches.
The deal with Microsoft was originally reported in July but not confirmed at that time. Adallom has raised more than $49 million from investors since starting up. The purchase of Adallom expands on Microsoft’s existing identity assets, and offers customers a cloud access security broker to provide them with visibility and control over application access as well as critical company data stored across cloud services, said Takeshi Numoto, Microsoft's corporate vice president of cloud and enterprise marketing, in a post on the company's blog.
Adallom said that SaaS applications can be as secure as on-site applications, so its software can monitor privileged user accounts, prevent data leaks and enable the private sharing of confidential data. Adallom’s security platform can also help companies keep up with regulatory and compliance mandates for data in the cloud.