) recently announced that it has acquired PhoneFactor, a company
that uses smartphones for security authentication. The financial
terms of the deal were not disclosed.
Overland Park, KS-based PhoneFactor is a multifactor
authentication (MFA) applications provider selling phone-based
products for enterprise applications. Its technology is compatible
with both Microsoft enterprise products and platforms from other
The MFA applications provider already works with many Microsoft
products and services, including Outlook Web Access and Internet
Information Services, and interoperates with Active Directory.
Management also stated that for now, PhoneFactor will continue
to operate independently and sell its products as a stand-alone
service with existing pricing and contracts. Upon the completion of
the deal however, PhoneFactor's technology will be licensed under
Microsoft's volume licensing contracts.
The multi-factor authentication technology is designed to
protect enterprise services and applications from data breaches if
user passwords are unethically stolen by a hacker. A user needs
more than just a password to log into websites that use
PhoneFactor's technology. A code is to be entered as an added level
of identification. This code is sent to the user's phone via text
or an automated phone call.
This type of authentication is specially required in business
and enterprise environments, where it is important to protect
sensitive information. Hence, the acquisition will enable Microsoft
to enhance the security of business mobile applications, its cloud
services and other applications.
Microsoft remains one of the best positioned software vendors,
given its wide range of products, emerging markets strength,
continued technology deployment at data centers and growth in cloud
computing. We believe that Microsoft's current investments are
supported by its strong balance sheet and expect these to drive the
next growth phase, improving prospects of market share gains.
Microsoft Corp. has a Zacks #3 Rank, which implies a Hold rating
in the short term (1-3 months).
MICROSOFT CORP (MSFT): Free Stock Analysis
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