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Security Firm Expects 'Love Bug' Boost
By Uday Khandeparkar
BOMBAY (Reuters) - The destructive ``Love Bug'' virus has given Internet security firms a big boost and they expect phenomenal revenue growth, an official of a leading Indian computer company said on Tuesday.
``The Internet security market has grown at 800 percent (annually) in the last three years,'' said Sanjeev Nikore, executive vice president of HCL Comnet Systems & Services Ltd.
``There is an explosion and we are finding it extremely difficult to cope with the requirements.''
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HCL Comnet sells and supports security systems in India of companies such as Trend Micro Inc (4704.Q), Internet Security Systems Inc (NasdaqNM:ISSX - news), RSA Security Inc (NasdaqNM:RSAS - news) and Checkpoint Systems Inc (NYSE:CKP - news).
The firm is a 100 percent subsidiary of HCL Technologies Ltd (HCLT.BO), which floated a minority stake on the Bombay Stock Exchange in January and is widely expected to seek an ADR listing.
Changing Perceptions
``Incidents like Love Bug are changing perceptions... I expect our security (business) will grow at 1,000 percent now,'' Nikore told Reuters in an interview on Tuesday.
HCL Comnet, started only 18 months ago, also provides networking services.
The company, which had business of about 10 million rupees ($229,000) in the first year, expects annual revenue to rise to over one billion rupees in its second year, he said.
Its parent, HCL Technologies, last month reported a 150 percent rise in third quarter net profit to 654.3 million rupees ($15 million). Its sales rose 23 percent to 2.36 billion rupees.
For the nine-month period beginning July 1999, the company's net income rose to 1.46 billion rupees from 599 million. Revenues rose to 6.33 billion rupees from 5.26 billion.
HCL Technologies shares have recently retreated along with the other tech stocks, falling back from a record high of 3,021 rupees to 1,557.75 on Tuesday.
But it is still way above its initial public offering price of 580 rupees.
``Security is going to be a very major portion of Comnet and we are planning to take our practice global, exporting technology from here through HCL Technologies offices in 24 offices in 15 countries,'' Nikore said.
Single Biggest Insurance Risk
Lloyd's of London LOL.CN said on Monday that e-commerce would emerge as the single biggest insurance risk of the 21st century.
It said a survey of U.S. insurance workers at a San Francisco conference last week showed 70 percent of delegates identified e-commerce as the major emerging risk of the new century.
Security scares caused by the ``Love Bug'' and attacks on leading Internet sites earlier this year only helped to boost a business that was already booming because of the exponential growth in electronic commerce, Nikore said.
``E-commerce transactions will not take off unless people feel secure. It is central to e-commerce,'' he said, adding that some estimates now put the size of global e-commerce trade at $450 billion by 2002.
``Even if five to 10 percent of that amount were to be spent on security, it means huge business for security firms,'' he said.
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