Introduction

Network Associates as they define themselves, is the world's largest independent network security and management software company and the eighth largest independent software company overall. Network Associates had been buying many different companies that developed software for network security and became a big company that can offer by now, a set of products for network security to any company in the world. Some important products are: McAfee anti-virus, PGP encryption and Gauntlet firewall.

Research on Network Security

Network Associates is a company that understood the importance of security issues in the Electronic Commerce environment. At a minimum, this means that the privacy of data and messages must be protected, identities must be verified and verifiable, and unauthorized access must be controlled (Turban&Lee&King, 2000). Technically, it requires a lot of research to create software that can really guarantee security. Network Associates should promote research projects inside and outside the company. In this way the company will have access immediately to the new results that researchers can do. Basically, this means that the company should assign a specific percent of their budget for research purposes; and encourage people that can demonstrate their technical skills, to innovate network security software.

Risk
The problems with this, is that many times that money will be spent without great results, but that is the risk that all sponsors take, and someday they get very important achievements.

Lock-in customers
Presently, Network Associates has an important brand name and is recognized in the entire world. At the same time their products are used in many international companies. The concept of "lock-in" refers to a situation where a customer has to follow actions because of the position of a specific product. Shapiro and Varian state "When the costs of switching from one brand of technology to another are substantial, users face "lock-in". A supplier can take advantage of "lock-in" a customer because they get the desired loyalty without new effort, just because the customer is locked-in. Network Associates can take advantage of "lock-in" all those international customers, and just define the boundaries of their own service, like prices, conditions, guaranty and resources that they need. The company already got loyalty and the brand name that just need to keep and maintain.

Risk
If Network Associates take advantage of this phenomenon without taking care of security (the most important purpose of their products) and customer satisfaction, then, no matter how locked-in are the customers, they could choose to change the product. The company has already a big advantage but they should maintain the quality of their products and services.

Legal assessment

This company works with products that can affect in someway the stability of an entire company or even the stability of an entire country. That is the reason why the government of the United States regulates security issues and other governments could do the same. In order to prevent legal problems, this company needs to be aware of all the current regulations that may determine any change in their product or services that this company offers. A legal assessment inside the company will be able to prevent legal problems and influence the company in acting according to the law.

Risk
People that are part of this legal assessment should be able to understand technical issues of the products and understand the goals of the company. If lawyers take care just of the law without looking for the interests of the company, then the company may not make any risky business and later lose market opportunities.

Sources:

- Efraim Turban, Jae Lee, David King, and Michael Chung. Electronic Commerce: A Managerial Perspective. Prentice-Hall 2000.
- Carl Shapiro, Hal R. Varian. Information Rules: A Strategic Guide to the Network Economy. Harvard Business School Press, 1998.
- Network Associates webpage (Apr, 2001) http://www.nai.com/