BT Acquires Counterpane

Today British Telecom announced that it has acquired Counterpane Internet Security, Inc.

This is something I've been working on for about a year, and I'm thrilled that it has finally come to pass.

EDITED TO ADD (10/25): Best blog comment ever.

EDITED TO ADD (11/3): Commentary from one of our investors.

Posted on October 25, 2006 at 1:06 AM • 86 Comments

Comments

Ben BrockertOctober 25, 2006 1:40 AM

Congratulations. It's interesting (and unusual) to see a company be that proactive about improving their security. Especially a telecom company.

PedanticOctober 25, 2006 1:45 AM

I don't know if you were consciously copy-and-pasting but it should be "announced that it has acquired Counterpane."

MikeOctober 25, 2006 1:45 AM

Congratulations ... very interesting. Let's hope you can bring sensible thinking to the maze that is their various customer services departments.

Since they're no longer public, I thought they only traded under the name BT and were not actually British Telecom anymore?

KerubOctober 25, 2006 1:45 AM

compliments.
excuse me for the OT but this is the chance to suggest to everybody an interesting search:

malware in quantum computing


I saw something on Slashdot. bye.

ritchieOctober 25, 2006 1:54 AM

Congratulations & kudos! I hope Counterpane continues the good work and I also hope this deal won't interfere with your great blogging!

ojcOctober 25, 2006 1:55 AM

Congratulations! Does this mean we can expect to see Counterpane expanding it's offices to other countries where BT has a presence?

AOctober 25, 2006 2:12 AM

Oh dear, what a shame. Of all of the companies to be acquired by, I can hardly imagine one I'd like less. BT have dragged their heels about upgrading exchanges, LLU, have had uncompetitive pricing structures. Ofcom (the telecoms regulator in the UK) has issued quite a few critical reports about BT. I hope it works out for you, and you can take the money and run. It isn't April 1st, is it?

AbleCableOctober 25, 2006 3:00 AM

sorry to hear about this. as someone who works in security and for bt - not a good move. I hope you can keep your independence and can keep at arms length the bureaucracy! Good Luck! I do hope that your good work and newsletter will continue?

Clive RobinsonOctober 25, 2006 3:14 AM

Congratulations,

But make sure the cheque is in the bank.

BT have run up some very very large debts on the UK NHS IT spine project.

Have a look at,

http://editthis.info/nhs_it_info/...

And many other sites.

BT have invested atleast 200Million GBP sofar and have only seen a return of around 1.2Million.

Also they are likley to take a significant loss on work carried out by their subcontractors.

Kousik NandyOctober 25, 2006 3:18 AM

Congratulations! I hope you'll start another successful security company next year. And you'll get more time to focus on everyday security issues.

Paul JohnsonOctober 25, 2006 4:12 AM

I notice in the press release it says that BT's growth includes organic and inorganic phases.

Do you think they've got the chemistry right?

Paul.

Bruce SchneierOctober 25, 2006 4:12 AM

"Since they're no longer public, I thought they only traded under the name BT and were not actually British Telecom anymore?"

You might be right. I honestly don't know. (I suppose I'll have to figure out what to call them.)

Bruce SchneierOctober 25, 2006 4:14 AM

"I'm happy for you, but I hope that won't mean we loose your contributions (blog, articles)."

You won't. They know I am an independent security commentator. My blog, newsletter, articles, and op eds are not a surprise to them. They're not looking for me to become a corporate shill.

(If they were, I wouldn't have joined them.)

Bruce SchneierOctober 25, 2006 4:14 AM

"Does this mean we can expect to see Counterpane expanding it's offices to other countries where BT has a presence?"

Most certainly. A European SOC is one of the first things on the agenda.

Bruce SchneierOctober 25, 2006 4:16 AM

"I hope you can keep your independence and can keep at arms length the bureaucracy! Good Luck! I do hope that your good work and newsletter will continue?"

That's certainly the plan.

Johnny ChaddaOctober 25, 2006 4:32 AM

Congratulations! I wish all the best for you and the company, now under new flag.

I am hoping that this does not affect the openness in your blog entries.

David MolnarOctober 25, 2006 4:45 AM

Congratulations! I've had the pleasure of working with BT's research division and loved it. Here's to they and you continuing to do good work...

AlvyOctober 25, 2006 5:31 AM

Congratulations!

I couldn't find the number of employees working for Counterpane at the moment, is it public?

bobOctober 25, 2006 7:01 AM

Odd that they call(ed) it "British" Telecom; everything else in britain they just call "THE (whatever)" and assume everyone else has to denote that they are NOT the british one; (british) Automobile Assn. (british) Kennel Club. (london) Times.

ReaderOctober 25, 2006 7:06 AM

Impressive achievement Bruce. Congratulations.

Just out of interest, what plans for the future did you have when you founded Counterpane? I mean did you have a mission statement and target to become a big player in the field or was Counterpane another garage startup that succeeded way beyond initial expectations?

Any advice for others who might want to work in the security industry?

AlexOctober 25, 2006 7:21 AM

>> I hope you can keep your independence and can keep at arms length the bureaucracy!

> That's certainly the plan.

forget about it... I have gone through a similar process (purchased by BT, although with a much smaller company) and inevitably with such corporate moguls bureaucracy and politics have become my day to day activity. Hope you have a nice exit plan and that a good part of the deal was in cash.

That being said congratulations !

SeánOctober 25, 2006 7:25 AM

"Most certainly. A European SOC is one of the first things on the agenda."

Come to Dublin and employ all your Irish newsletter subscribers! ;-)

BarryOctober 25, 2006 8:00 AM

Well, since you're now working for BT, my mum's got a problem with her international dialling... ;-)

Congratulations.

JonOctober 25, 2006 9:06 AM

Congratulations!

I hope this will not limit expansion in the Americas on the way toward world domination :-)

Next up: London restaurant reviews?

Bruce SchneierOctober 25, 2006 9:07 AM

"I have gone through a similar process (purchased by BT, although with a much smaller company) and inevitably with such corporate moguls bureaucracy and politics have become my day to day activity."

I hope you're wrong. But if you're not, I'll leave.

BT knows what they're getting into, though, and they have "independent" pundits in other areas of technology. So I'm optimistic.

Carlo GrazianiOctober 25, 2006 9:44 AM

FLUNKY: Sir, that Schneier person called again. He left a detailed
message.

CEO: Again? What does he want this time?

FLUNKY: Well, to begin with, he'd like BT to accept legal liability for
security compromises of our DSL customers' computers.

CEO: He WHAT?

FLUNKY: Yes, sir. Externalities.

CEO: Come again?

FLUNKY: He said [mumbles] externalities.

CEO: What's an externality?

FLUNKY: I thought _you_ knew.

CEO: No idea. I haven't read this month's "CIO Trends" magazine though,
maybe it's in there. Doesn't matter really, we're filing this under "Hell
Freezes Over". Anything else?

FLUNKY: Yes, sir. He wants you to start wearing your company badge to
work.

CEO: Why? Security knows who I am, and I have the key to my private
elevator anyway.

FLUNKY: Yes, er, well...

CEO: What?

FLUNKY: He's...that is to say...

CEO: He's after my elevator too, isn't he?

FLUNKY: Well, he says it's bad security to create a privileged low-security
channel for a lucky few.

CEO: He isn't a socialist, is he?

FLUNKY: He's a very wealthy one if he is.

CEO: HFO file. Is that it?

FLUNKY: [mumbles] password...

CEO: [steely glare] He's after my password _again_?

FLUNKY: He seems to think that "Cat" is weak.

CEO: I _know_ it's weak. But two of my secretaries can't recall how many
fingers they have without counting, and the other one can't spell. How are
they supposed to remember my password if I make it something complicated,
like my birthday, or Mom's name?

FLUNKY: [Looks at floor, embarrassed, would obviously rather leave at this
point, sighs again at message] It's a funny thing, he had a few things to
say about secretaries, birthdays, Moms...

CEO: Not interested. Let's cut to the chase. What does he want my
password changed to?

FLUNKY: dF3#(~!pk40%L/sD:@

CEO: This is a prank, right?

FLUNKY: That's this week's password. He has another one for next week.

CEO: Bring in his golden parachute agreement. I want to look it over.

MattOctober 25, 2006 9:46 AM

not "The Telecom", but that's only because BT is a pretty new entity. It was spun off from (the) General Post Office 20 or so years back :-)

Andy BOctober 25, 2006 10:06 AM

Do you plan on staying in Minneapolis? I'd sure miss your contributions to the Strib (both securipoliticultural and culinary).

RoyOctober 25, 2006 10:17 AM

If you could see the weather in Ireland today you might decide to open your European base in the Bahamas :)

Cryptool-UserOctober 25, 2006 10:54 AM

Crypto-Gram Newsletter

Congratulations!

Q: I enjoyed your monthly Crypto-Gram Newsletter. Will you still continue issuing it?

RoxanneOctober 25, 2006 11:40 AM

Isn't this about the third time that you've Gone Over To The Dark Side? ;-)

So how is British Telecom better or different from AT&T?

Congratulations.

antibozoOctober 25, 2006 11:49 AM

Mike> Since they're no longer public, I thought they only traded under the name BT and were not actually British Telecom anymore?

That's slightly comical, since for millions of organic gardeners, BT means bacillus thuringiensis.

Bruce SchneierOctober 25, 2006 11:50 AM

"I enjoyed your monthly Crypto-Gram Newsletter. Will you still continue issuing it?"

Most certainly. Both Crypto-Gram and the blog will continue. Note that neither are hosted on the Counterpane website.

Agent ChuckOctober 25, 2006 12:31 PM

Will that mean severing your relationship with In-Q-Tel?

I suppose it also frees up your time to produce Crypto Gym infomercials with Christie Brinkley.

:-)

Seriously, congratulations! All the best to you and your company's future!

tinphoilOctober 25, 2006 1:02 PM

"Today [telecom monstrosity] announced that it has [devoured] Counterpane Internet Security, Inc."

Somewhat ominous, but hopefully Counterpane will be able to affect positive changes... before being digested. :/ good luck and congratulations on the personal achievement~

another BT employerOctober 25, 2006 1:10 PM

Well done Bruce!!

I work for BT and it's not all bad. Lots of moaning from the private customer part of the company.

The business to business group e.g. Global Services is pretty damn good and determined to be a world leader, if not the world leader in networks and convergence. I guess the acquisition of Counterpane is one small part of that journey.

Also, last time I checked (couple of hours ago) BT was still a public company. Or did Mike et al mean "a nationalised company"?

TamzenOctober 25, 2006 1:51 PM

Congrats, Bruce. Glad to see all the hard work of past and present Counterpane employees paying off.

ex-BT employeeOctober 25, 2006 2:46 PM

Sucks to be you given what I saw during my time there. Hope it works out better for you.

MauriceOctober 25, 2006 3:02 PM

Good luck with BT - interesting that your opening a european office pity that BT got rid of BP (Bletchly Park).

Oh dont be suppreised if you ring Martelsham and get the phone answered with the Unit OUC :-)

Btw not all of the smart people work at MH

anjan bacchuOctober 25, 2006 4:01 PM

hi bruce,

congrats! I have been following you for more than 7 years by subscribing to your newsletter. and reading your books.

I hope that you will continue to NOT only publishing your blog at the same pace BUT also write for magazines like Wired, etc.

It will be even more important for you to continue writing books since the experience working for BT will, I'm sure, make your views even more holistic.

BR,
~A

nbk2000October 25, 2006 4:51 PM

Excuse me for being a cynic, but isn't BT government operated?

Maybe not literally, but they certainly are the lapdogs of the Government, and the brits are the lapdogs of the Bush administration.

How does the aquisition of Counterpane affect the internet in general? Does this give an easy 'in' to potential government spys?

Austin HillOctober 25, 2006 5:40 PM

Congratulations Bruce. I know how much hard work goes into building and negotiating the sale of a company.

I wish the best for you and the entire team.

antibozoOctober 25, 2006 7:07 PM

I also want to say "Congratulations!" and I hope you are stinking rich as a result. :^)

another BT employerOctober 26, 2006 3:32 AM

Bruce,

Welcome to BT - I see you on Desktop Directory already!

Enjoy the ride.

another_bruceOctober 26, 2006 3:40 AM

congratulations mr. schneier. i hope you made a shitload of money off of this.

Justin FrankelOctober 26, 2006 3:44 AM

Congrats indeed! I would like to propose that (assuming this year's elections don't change things substantially) you give up the whole internet security thing, and run for Congress! We need more intelligent, honest people representing us! Yeah! Scheier in 2008!

(Only half kidding)

-Justin

BTerOctober 26, 2006 5:46 AM

Sounds like a good deal all round. You get shedloads of wonga and we get your brain! Plus you get to stay "maverick". Can only do us all a favour. Welcome aboard, hope you stick around.

bLanarkOctober 26, 2006 6:46 AM

"Most certainly. A European SOC is one of the first things on the agenda."

Geeza Job!

Royal Berkshire would be a great place, IIRC then BT have/had buildings in Bracknell.

MauriceOctober 26, 2006 7:37 AM

NBK2000

The Govt Sold there last BT share a long time ago - I think even the golden one has gone now.

Any how all phone compaines have a relasionship with the security services doesnt evryone know that - how do you think phones get tapped.

Tim BOctober 26, 2006 8:26 AM

"As at 31 December 2004 the audited gross assets of the business were $6.8m."

I read that VC investors may have put over $70MM into Counterpane. Doesn't sound like much in the way of ROI.

SnipeOctober 26, 2006 9:16 AM

Good luck Bruce. Having had to work on a project a few years ago with the shambles that is BT's integration arm, I strongly believe you'll need it.

JimjoOctober 26, 2006 1:35 PM

bob said : Odd that they call(ed) it "British" Telecom; everything else in britain they just call "THE (whatever)" and assume everyone else has to denote that they are NOT the british one; (british) Automobile Assn. (british) Kennel Club. (london) Times.

Don't stop there bob: English and American English; football and American football...

bexOctober 26, 2006 1:39 PM

Question... I agree that outsourcing security is important... but isn't BT too big and evil to trust? Doesn't that increase the odds of a conflict of interest, red tape, and rogue security consultants?

Side question... is there an optimal sized company to outsource security to? Small, medium, large, über?

MauriceOctober 27, 2006 8:42 AM

bex

why would the size of business make people less likely to trust the organisation the man/woman in the street does tend to "Trust" BT.


I'me sure most big companys would prefer a big company with history -don't forget BT's parent was where colussus came from.

I'me stil pissed off that when they renamed the Adastral park buildings they didn't name the main lab building after Him.

bexOctober 27, 2006 1:25 PM

Complexity makes security more difficult, and bigger companies have a tendency to be more complex.

Its not an absolute... I just find it difficult to trust a large multi-purpose organization as much as a single-purpose security firm.

But... BT's expertise and resources are a plus... so the trade-off might be OK.

JeOctober 29, 2006 5:51 AM

First of all, congratulations!

I've been in two companies that got bought and assimilated untill now and none of them were able to keep their soul. I do hope it will not happen to Counterpane too.

OTOH

Bruce, there's lots of business to be made on mainland Europe. Any plans for an office in say N Germany? ;)


Good luck!

swiss connectionNovember 6, 2006 2:04 AM

Bruce, I guess you can now take off the

"Schneier.com is a personal website. Opinions expressed are not necessarily those of Counterpane Internet Security, Inc."

comment on the bottom of your blog.

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