BusinessIBM acquires security threat, fraud detection software developer

Published 1 September 2011

Acquisition extends IBM’s menu of offerings for governments, law enforcement, retail, insurance, and healthcare clients in what the company describes as “the Era of Smarter Cities”

IBM yesetrday announced a definitive agreement to acquire i2 to accelerate its business analytics initiatives and help clients in the public and private sectors address crime, fraud, and security threats. Financial terms were not disclosed.

With more than 4,500 customers in 150 countries, i2 is a provider of intelligence analytics for crime and fraud prevention based in Cambridge, United Kingdom, with U.S. headquarters in McLean, Virginia. i2’s clients span multiple sectors globally such as banking, defense, health care, insurance, law enforcement, national security, and retail. i2 solutions are currently used by twelve of the top twenty retail banks globally and eight of the top ten largest companies in the world.

IBM says that organizations in both the public and private sectors today are facing an exponential increase in “big data” — information and intelligence coming from disparate and unstructured sources including social media, biometrics and criminal databases. When it is accessible to the people who need it, this information can be used to anticipate potential problems, make better, faster decisions, and coordinate resources to deliver exceptional service to citizens and customers.

IBM says that the acquisition will extend IBM’s leadership in helping clients harness this data through the addition of i2’s intelligence analysis and tactical lead generation capabilities, which help cities, nations, international bodies, and private enterprises combat fraud and security threats.

Fraud and security threat reduction is of strategic importance across all industries today. According to FBI statistics, in 2009 there were 1.3 million violent crimes, 9.3 million property crimes, and 6.3 million larceny/thefts in the United States. Consumer-facing fraud for retailers alone costs $100 billion a year in the United States.

In response to these threats, businesses and government agencies are seeking to empower public safety officers, analysts, managers, detectives, and investigators with industry-specific intelligence analysis and operational insight solutions. For example, government agencies today are concerned with increased threats to public safety, which are driving the need for secure information sharing.

IBM’s goal is to better equip public safety officials and businesses with the information and tools they need to ensure safer cities,” said Craig Hayman, General Manager of Industry Solutions at IBM. “The combined capabilities of IBM and i2 will help customers uncover patterns and trends that will allow them to more effectively protect the privacy and safety of citizens, businesses and governments.”

“The combination of i2’s products and IBM’s advanced data collection and warehousing technologies will be compelling for clients seeking to enhance situational awareness and make connections between seemingly unrelated information from oceans of data,” said Robert Griffin, CEO, i2. “i2’s existing clients will be at home with IBM, a company known for its ability to help organizations make the most of their data assets.”

Using IBM real-time analytical solutions in combination with the technologies of i2, public agencies and private enterprises battling fraud will now have the capability better to collect, analyze, and process all the relevant data at their disposal. In the past, data overload often led to critical information or opportunities being missed.

The company says that local, state, and federal authorities will now be able to use new intelligence tools to detect and respond to security threats. Investigative leads can be identified quickly, helping government agencies solve crimes faster and keep officers and communities safer.

i2 will be integrated into IBM’s Software Group, which is a key driver of growth and profitability for the company. Headquartered in the United Kingdom, i2 has 350 employees.

The acquisition is anticipated to close in the fourth quarter of 2011, subject to the satisfaction of customary closing conditions and applicable regulatory reviews.

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