Microsoft to pay $320 million for cloud security provider Adallom

Reports have emerged stating that Microsoft is to drop $320 million in cash for Israeli cloud security startup Adallom.

Adallom – founded in 2012 with just 80 employees – provides security tools for cloud applications. News of the acquisition broke in Israel where Adallom is based, before being reported by Reuters.

Although to date neither company have commented on the rumoured deal, the acquisition would seem to follow the current thinking at Microsoft. Upon appointment last year, CEO Satya Nadella stated that the company has to thrive “in a mobile- and cloud-first world,” and this would certainly match that brief, allowing Microsoft to provide extra protection for products such as Azure and Yammer.satya_nadella

Assuming the deal goes ahead, and if Adallom continues to function as an independent unit – as a source allegedly told VentureBeat it will – Microsoft will find itself in the awkward position of providing cloud security for a number of its rivals, including Google Apps and Dropbox. Adallom’s website also lists the likes of Netflix, HP, Pixar, SAP, Orange and LinkedIn among its customers – as well as Microsoft’s own Office 365.

If confirmed, the deal will come just weeks after Microsoft was forced to write off the $7.6 billion it spent on Nokia’s Devices and Services division last year, where 7,800 employees were laid off. The swift return to company acquisition – albeit on a much smaller scale than the Nokia buyout – is a reminder that Microsoft is still a force to be reckoned with, especially if it keeps its promise to become more reactive and focused. This deal is another sign of that intent.

Images: Bhupinder Nayyar and Robert Scoble used under Creative Commons.

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