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Finjan Gets Investment from Microsoft

Finjan Software, a security firm involved in a recent public spat with Microsoft over publicly discussing the software giant's security flaws, has landed a minority investment and patent deal from Microsoft.

Finjan gained notice in November when it announced it had discovered 10 vulnerabilities in Windows XP Service Pack 2, a service pack released three months earlier that was designed to close off a number of security vulnerabilities.

“The recently released Service Pack 2 of Microsoft Windows XP operating system offers certain features of security. However, it suffers because it is still basically the same operating system and has some major flaws which compromise end-user security,” then CEO of Finjan Shlomo Touboul said at the time.

Microsoft publicly brushed aside the severity of the flaws and admonished Finjan to keep quiet about the flaws in public and to work with Microsoft in private to address any issues.

On Wednesday, Finjan announced that Microsoft made an equity investment in the company and that Microsoft purchased a non-exclusive worldwide license for some Finjan patents covering computer security technologies.

“We are very pleased with this new cooperation with Microsoft. Both companies believe that innovative measures are required to achieve greater security,” said Asher Polani, current CEO of Finjan. “Finjan benefits from a wide range of patents dating back to 1996. For nine years now, Finjan’s approach in developing innovative security technologies has proven to be an efficient and effective compliment to signature based security.”

Kenneth Lustig, Microsoft's managing director of Intellectual Property Business Development, provided a statement for Finjan's announcement. “Finjan has done some interesting product innovation in the security space,” Lustig said. “We are pleased to have access to this intellectual property as we work to advance the state of security innovation throughout the industry.”

The deal comes just nine days after Finjan's board of directors removed Touboul, the founder of Finjan, from the CEO job and replaced him with Polani, a former Hewlett Packard Israel executive.

The board said the company needed to make the change as it transitions from a software-based security solution company to a company that exclusively delivers appliance-based solutions. The company is also shifting from direct sales to a channel-based business.

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.