On October 25, 2006, BT announced its intent to acquire Counterpane Internet Security, a pioneer in the managed security services (MSS) market.

This is the second major acquisition of a managed security service provider (MSSP) in the past 90 days. The previous acquisition was of ISS by IBM. It is also the second acquisition of a managed service provider (MSP) by an offshore player following Cognizant’s acquisition of Aimnet Solutions in September.

While most people view BT as a major carrier, it is also a major outsourcer. So, its acquisition of Counterpane, along with IBM’s acquisition of ISS, indicates that the major outsourcers now view managed services in general and MSS in particular as a critical component of their portfolios going forward.

I perscribed this approach in a NetworkWorld commentary earlier this year. At that time, I suggested the major outsourcers had to devise a means of downsizing their services to overcome the high failure rates of their traditional outsourcing agreements and provide a more palatable alternative to their prospective customers.

Although carriers originated the concept of managed services back in the 1980s when they offered a set of specialized management services to their largest customers, the carriers have struggled to package and deliver a broader portfolio of managed services aimed at a larger cross-section of small- and mid-size businesses (SMBs). Buying rather than building managed service capabilities may be a better path to success, but most acquisitions fail to achieve their original business objectives.

Counterpane monitors 550 networks worldwide for multinational and Fortune 100 customers, BT’s target market. By acquiring Counterpane, BT not only gains solid security capabilities and skills it also gains a foothold in the U.S. where it has failed in the past to build a strong presence. The acquisition also puts BT at the epicenter of the U.S. technology industry in Silicon Valley where it can build relationships with other important players.

The acquisition leaves only a handful of independent MSSPs with any significant market presence. One of the remaining firms worth keeping an eye on is Perimeter Internetworking based in Milford, CT. Perimeter has been growing rapidly through a combination of acquisitions and targeted marketing aimed at specific verticals such as the community banking industry. The company’s acquisition campaign has enabled it to grow from a regional to national player.