IPVG buys US Internet security firm for $10.5M

Publicly-listed information technology and gaming conglomerate IPVG Corp. has completed the purchase of Prolexic Technologies Inc., a US-based Internet security service provider, for $10.5 million.

IPVG said the acquisition is in line with the company’s roadmap of growing in key areas in the Internet domain.

Our investment in Prolexic gives IPVG ownership of a propriety platform for DDoS (distributed denial of service) mitigation that has a global application. Prolexic has established itself as a clear leader in DDoS mitigation, and combining this with IPVG’s data center infrastructure and access to new markets will translate to a unique offering for our target customers around the world,” said Enrique Gonzalez, chief executive officer of IPVG.

Gonzalez noted that DDoS attacks have increased in size and frequency by more than 200 percent over the last 12 months.

“The continued growth of the Internet translates to sustained demand for secure hosting environments and Internet security services. With Prolexic, we can make the Internet a safer place,” Gonzalez said.

Prolexic provides cutting-edge solutions that protect Internet operations from the debilitating service disruptions caused by DDoS attacks. It offers services such as SURBL and URIBL – industry-leading anti-spam sites which have been under a series of DDoS attacks.

SURBL and URIBL are uniform resource identifier (URI) blacklist services that allow filters to efficiently identify unsolicited messages based on the Web sites advertised within the email. Both organizations offer free public domain name system (DNS) interfaces for easy integration with existing anti-spam software.

Founded in 2003, Prolexic was the first company to stop DDoS attacks as a scaling subscription service. Today, more than 7,000 Web sites entrust more than 10-billion page loads monthly to Prolexic and depend completely on Prolexic to keep their sales, marketing, and customer service and support sites up and running.

“Prolexic has led the DDoS mitigation sector for many years. We were the first to offer DDoS scrubbing centers in all major global regions. We have combined the industry’s most advanced and sophisticated mitigation technology with the world’s largest dedicated DDoS mitigation network. Joining forces with an aggressive company such as IPVG will allow Prolexic to extend its market leadership worldwide in the continuing arms race against DDoS attackers,” said Prolexic president Keith Laslop.

A DDoS attack occurs when a network or Web service is rendered unavailable or inaccessible to its intended legitimate users, either temporarily or permanently, usually by flooding the target system with high volumes of traffic. Perpetrators of DDoS attacks typically target sites or services hosted by high-profile institutions such as those from the financial services sector, payment gateways, government sites, Web sites of major corporations, entertainment sites and the media.

According to the Computer Security Institute, there are as many as 10,000 DDoS attacks occurring worldwide each day — the size of which go beyond 10 gbps at times — and the likelihood of an organization experiencing an attack is growing. Without any warning, Web sites and Web applications can be taken down, cutting off customers, partners and suppliers.

The FBI/Computer Security Institute 2007 study indicated that the loss of revenue attributed to DDoS in just an hour could be $90,000 for a sales catalog company to $6,450,000 for a retail brokerage.

Prolexic has global security operations centers in Europe, the US and Asia that are able to respond to security attacks within minutes of a DDoS attack.

IP-Converge Data Center Inc., the data center unit of IPVG, has worked with Prolexic to defend its customers against DDoS attacks for the past two years. The size of the attacks have ranged from 100 mbps to over 21 gbps and, if not prevented, would have cost millions of dollars in revenues and lost business opportunities.

In its July 2007 report, Prolexic noted that cyber-criminals target organizations for financial gain, competitive advantage, corporate sabotage or ideological opposition. Their methods get more sophisticated and more powerful as businesses increase their security.