Symantec raises subscription rates

Symantec Corp. quietly increased subscription renewal rates for its entire line of security products last week, citing the rising cost of fighting viruses and other malicious code worldwide.

The company is upping subscription renewal rates by US$5 on all of its products. Australian customers are affected by this rise.

While previous rate increases have drawn the ire of users, Symantec executives say they are confident customers will understand why they're increasing prices. The hike comes just days after the company announced it would include piracy-fighting product activation technology in all of its 2004 consumer products.

Funding the Updates

Symantec has employees on duty around the clock watching for the next virus to appear, and that costs money, says Del Smith, a product manager for the company.

"We have research centers in North America, Asia, Australia, and Europe," he says. "As soon as they see a new threat they begin delivering new protections."

And the volume of threats is ever increasing, he says. For example, in August 2002 Symantec received 90,000 files from Norton AntiVirus owners running the software's Scan and Deliver service, which sends suspected viruses to the company for analysis. Just one year later, in August 2003, the number of suspect files will top 130,000. Symantec's software currently protects users from more than 60,000 known viruses, Smith says.

Detecting new viruses is only the first step. When the company identifies a new virus or worm, staffers quickly begin developing a new definition file so that Norton AntiVirus software can detect the threat. Owners of the software download the new definitions via the subscription service.

The company's other security products, including utilities and firewall products, also require frequent updates, Smith says. Symantec staffers are constantly beefing up their products with everything from new URLs for Internet Security's Parental Control features to new updates for various firewall packages.

Over the years the company has also made significant investments to improve the way it creates these updates and then gets them to customers, he says. Today, most Symantec products automatically download and install these updates behind the scenes, without bothering the customer at all.

"To fund these services, and to allow us to continue to invest, we're raising prices," Smith says. The price increase impacts buyers in all countries except India, Japan, China, Taiwan, and Korea.

Prices Go Up

All of Symantec's products include an initial subscription. If you buy the product at retail or online, a year's subscription is included. Versions that ship on a new PC or other hardware usually include a three-month subscription.

While each program will continue to operate after the subscription period ends, it won't work as well without the latest updates. "It's important for users to keep up those subscriptions because it protects them against the latest threats," Smith says.

The cost of renewing the subscription for Norton AntiVirus standard moves from US$14.95 to US$19.95. The Pro version includes two licenses, so its renewal fee jumps to US$39.90. Renewal fees for Norton SystemWorks (regular and Pro) jump from US$14.95 to US$19.95; Internet Security (regular and Pro) fees increase from US$24.95 to US$29.95; and Norton Personal Firewall goes from US$9.95 to US$14.95.

This is the third subscription price increase in as many years for some Symantec products. In November 2001 the company upped the fee for Norton AntiVirus from $3.95 to $9.95 (and vocal PC World readers complained). In Sept 2002 it increased the price again, to US$14.95.

Those increases may sound exorbitant, but the threat has also increased exponentially, says Rob Enderele, principal analyst with the Enderle Group. In the end, most people will grumble but pay, because it costs more to move to a competing product, he says. For example, Symantec competitor Network Associates' newly released McAfee VirusScan 8.0 sells for US$60. (A company spokesperson notes, however, that there are no immediate plans to raise VirusScan's US$14.95-per-year subscription rates.)

Antivirus software and subscription renewals can be pricey, but most users now understand it can cost even more to go without it, Enderle says. Losing your hard drive to a virus will cost you considerably more than US$20, he adds.

Symantec isn't likely to lose many customers over the price increase, but combined with the decision to include product activation on all of its 2004 products, the company risks aggravating it customers one time too many.

"Now that Microsoft is moving into antivirus, this process of continuing to aggravate the customer may come back to haunt this company," he says. Microsoft announced in June plans to offer antivirus protection in future products. Most likely this will be included in future versions of Windows, such as Longhorn, due in 2005, he says. Users irritated by Symantec's pricing and product activation decisions may decide Microsoft's protection is good enough.

Symantec executives aren't worried, however. "We believe our pricing is competitive with what others are offering, and we also believe that the technology we provide offers the best protection in the market today," Smith says.

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