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Aruba Buys Wireless Security Biz

Startup Network Chemistry Inc. is selling its wireless security business to enterprise WiFi firm Aruba Networks Inc. (Nasdaq: ARUN) for an undisclosed sum as it attempts to move into the open-source world.

Network Chemistry has developed a number of WiFi-based intrusion detection and security products for other RF technologies in the past few years, and is considered one of the leading startups in this field. (See Network Chem Protects and Network Chemistry Opens Up.)

Network Chemistry CEO Brian de Haaff says, though, that the sell-off will allow the company, one of Unstrung's Top Ten Startups, to get back to its open-source roots. (See 2006: Top Ten Startups.)

There were "multiple parties interested" in the security business, de Haaff claims, but he says Aruba is the right buyer, particularly abecause the entire security team will move over to the WiFi vendor without any job losses.

"They were the best fit," says the CEO.

For the past year or so analysts and industry watchers have been predicting consolidation in the WiFi security market as more established players add this specialist, but crucial, enterprise software and hardware to their overall wireless LAN portfolio.

Cisco Systems Inc. (Nasdaq: CSCO), which snapped up Meetinghouse Data Communications, and Juniper Networks Inc. (NYSE: JNPR), which acquired Perfigo and Funk, have already cherry-picked a number of startups developing WiFi and wireless-related products. (See Cisco's Secure Access and Juniper Gets Funky.)

There are still, however, several well known security startups that are up for grabs, including AirMagnet Inc. , AirDefense Inc. , and AirTight Networks Inc. . [Ed. note: Maybe the larger vendors can't tell them apart!]

Network Chemistry, meanwhile, is heading off into the enterprise open-source market. The company's first product for this space will be search software that helps IT staff search their company's intranet for data on IT resources within the organization.

De Haaff wouldn't be drawn on how much Aruba paid for the security business, but he claims it gives the company a "nice war chest" for its new adventures in open source.

— Dan Jones, Site Editor, Unstrung

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