NA reaffirms channel ties after Q4 losses

Network Associates' chief executive, George Samenuk, has warned that the company faces some "difficult decisions" after it suffered fourth-quarter losses.

Network Associates' chief executive, George Samenuk, has warned that the company faces some "difficult decisions" after it suffered fourth-quarter losses.

The security software vendor reported a $127.2m (£87.2m) loss for the quarter ended 31 December, roughly the shortfall it had warned investors to expect. "Let me be clear: I will not permit this loss to continue," Samenuk said. "We expect to be profitable in the second half of 2001."

Network Associates has changed its accounting model from recording sales figures when orders are booked, to when the orders are completed. Sarah Whipp, the company's worldwide channel marketing manager, said this was a major reason why the figures were so poor.

Earlier this year, the company split its four UK business units - McAfee, Sniffer Technologies, PGP Security and Magic Solutions - into individual sales units after identifying the difficulty of reselling a broad range of products.

Whipp said Samenuk's announcement would not affect this strategy or the company's UK channel focus.

"We are absolutely committed to a channel model and we recognise that it is key to our success," she said.

However, Whipp said it was too early to speculate about whether the split would be successful.

Ash Hussain, director of sales and marketing at reseller Axial, said things are looking up for the vendor. "The Network Associates channel team is very focused on individual business units," he said.

Whipp said: "The European business model is seen to be the one to follow. The designs and plans put in place are usually copied throughout the world."

She claimed that adjustments to the system would be part of an evolutionary process.