Verizon Business Global LLC - proposed acquisition of Cybertrust Holdings Inc

Summary

Verizon Business Global LLC proposes to acquire Cybertrust Holdings Inc.

Market definition

The proposed acquisition was considered in the context of a market segment for the supply of non - Defence Signals Directorate (DSD) accredited managed security services (MSS) (including DSD-accredited and other MSS suppliers).

Competition analysis

On 18 June 2007, the ACCC formed the view that the proposed acquisition was unlikely to result in a substantial lessening of competition in the relevant market.

Factors informing this conclusion include:
- there would remain a significant number of DSD and non-DSD accredited MSS suppliers to which customers could turn in the event of a SSNIP by the merged firm;
- barriers to entry for the supply of non-DSD accredited MSS are unlikely to be substantial, especially in the case of major international suppliers seeking to enter the market;
- larger customers of non-DSD accredited MSS supply are likely to possess significant countervailing power; and
- it is unlikely that the merged firm would have sufficient ability to bundle or tie the supply of bandwidth and MSS so as to foreclose competing suppliers of bandwidth and/or DSD-accredited MSS.