May 19, 2014 10:15 pm

Google buys New York start-up Divide

Tech angle: Google also got in on the ‘Merger Monday’ scramble, making a bold bet on the emerging ‘internet of things’ with the $3.2bn acquisition of the California start-up Nest Labs©PA

Investment bankers addicted to Candy Crush, take heart. Google has bought Divide, a New York-based start-up that lets users securely separate their work and personal data on smartphones and tablets, effectively turning one device into two.

The idea is to help Google attract business customers dealing with a generation of “bring your own device” workers – people who reject the clunky hardware favoured by many big companies, and instead use their own smartphones for work documents and emails.

This self-service approach poses a problem for companies which cannot control security on those devices, and which risk losing their sensitive data and intellectual property if an employee misplaces their personal phone in the back of a taxi.

The terms of the deal were not disclosed. Divide had previously raised $25m from investors including the venture arms of Google, Qualcomm and Comcast.

Divide, formerly known as Enterproid, was founded in 2010 by three mobile executives who met at Morgan Stanley in New York – “a software house masquerading as an investment bank”, said co-founder and chief operating officer Alexander Trewby. He was referring to the bank’s innovations in areas such as high-frequency trading and mobile technology.

“Back in early 2000s, we were one of the only firms on Wall Street to have a mobile engineering team,” Mr Trewby said.

Divide will join Google’s Android operating system team and shut its office in London to work alongside Google. It also has offices in Hong Kong and headquarters in New York.

The software allows users to flick seamlessly between personal and secured work applications, and lets employers wipe data remotely in the event the device is lost.

The move should help Google extend Android’s reach as a tool for businesses. Google’s open-source model and the fact it has a relatively permissive approach to who can sell apps in its store, has made Android more vulnerable than Apple’s operating system to malware. It has also provoked some concern among potential enterprise customers.

Apple, by contrast, adopts a more restrictive stance towards developers in its store. The company is reported to be working on introducing a split-screen function for the next generation of iOS, which currently only allows one app to be displayed at a time.

Managing security on workers’ devices is particularly important in regulated industries like banking, where data breaches can attract hefty fines. In 2009, HSBC was fined over £3m when customer data were lost in the post.

Research group Gartner estimates that by 2016, one in five “bring your own device” programs put in place by enterprises will not work, because they will be too restrictive and employees will work around them.

For younger generations, the line between work and play is blurry, said Gordon Graylish, vice-president of sales and marketing at Intel.

“Millennials want access to both personal and work content on their business devices and there is a desire by companies to have the ability to separate [the two],” he said. Big companies are concerned about being able to attract and retain a younger workforce and need products that cater to that need, he added.

Mr Trewby said Divide had noticed a spike in activity around Thanksgiving, because people appear to be taking the opportunity of time away from the office to go through work emails.

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