Symantec feels the pain?

This week, Symantec launched their new “Internet Threat Meter” site; the “Internet Threat Meter” is basically a portal where Joe Average can go to see aggregated information about the “state of the Internet” – there are “traffic lights” (green/yellow/red lights) on the site that correspond to the overall “safety level” associated with PC usage at the current time. In case you haven’t seen it, here’s the link.

Just for the record, although they look similar, do not confuse the “Symantec Threat Meter” with the “Symantec Threat-Con” which is entirely different. Whereas the ThreatCon has four levels, the Threat-Meter has only three (probably to make it more accessible to the average user.) And while the colors for the Threat-Meter are green, yellow, and red, the Threat-Con colors are green, yellow, ORANGE, red (they’ve weeded out the overly-technical “orange” level.) Obviously, I’m being sarcastic.

What strikes me about this is not just the similarity (and competition) with the existing tool, but the similarity with Windows OneCare. From a user interface perspective, this new “Threat Meter” is very close to Microsoft Windows OneCare Live – both in terms of what’s available on the interface but also the way that the controls/tools are categorized, made available, installed, etc. Of course, this begs the question: is Symantec feeling the pain from OneCare already? Is the beta cutting into their sales enough that they are responding ad-hoc in a way that competes with rather than compliments investments they’ve already made?

Here’s my thinking… Symantec will never say this flat out, but they make their money from consumer AV. Judging by what we can infer (the way they break down the numbers is less than transparent), their reliance on consumer AV is anywhere from 50% to 80% of overall yearly revenue. How can we tell? Read between the lines – in Symantec’s 2005 Annual Report for example, they tell us that the consumer segment is their strongest sector (the “star performer” they call it.) They also tell us that their top selling software category is “security solutions.” Now, take the union of where “security software” intersects “consumer segment” – and compare that with what’s in their product line. See what I mean? They’re talking about consumer AV. You can actually line up the numbers in the report to make guesses about percentage of revenue (why I say between 50 and 80 percent – 80 is more of a historic number while the current report points to more like 50.)

Which means that Symantec is in for a world of hurt when those sales start to dry up – and dry up they will. Here’s the deal – when Microsoft starts selling something, competitors tend to go away. If we look at it logically, Microsoft can own the consumer AV market whenever it wants: they can ship their AV or anti-spyware with Windows. They can make OneCare free. In fact, I’ll bet you dollars to donuts that Microsoft giving away the free AV beta is already impacting Symantec’s sales. I’m not sure how much we can read into what SYMC’s up to, but I for one will be interested to see where this goes.