I've changed my mind about McAfee. For the longest time, I've had McAfee in my death pool. Partners consistently expressed bad feelings about working with the security vendor. Rumors persistently circulated about merger talks with other vendors. And its market position was tenuous compared with its longtime rival, Symantec.

At least two of those characteristics are different today.

Today, McAfee announced that it bought MX Logic, a leader in managed and hosted security services, in a deal valued at $170 million ($140 million cash and an additional $30 million earn-out if targets are met). MX Logic gives McAfee a solid set of e-mail and Web security resources, 1,800 partners and more than 40,000 customers in the burgeoning managed services market.

“The acquisition of MX Logic will reinforce our position as a leader in security-as-a-service and brings world-class e-mail and Web defense, including archiving and business continuity services, extending our proven expertise in providing cloud-based services to our customers. MX Logic aligns with the McAfee vision to lead security SAAS by bringing industry-leading technologies and a strong partner ecosystem,” said McAfee CEO Dave DeWalt.

So back to the reason McAfee was in my death pool. In 2006, McAfee was rumored to be near a deal to sell itself to Microsoft. The idea was simple: McAfee filled a number of product gaps in Microsoft's relatively nonexistent security portfolio. McAfee was at the end of a long restructuring that saw its divesture of businesses like PGP, Gauntlet, Magic and Sniffer. But McAfee wasn't doing well, and a merger seemed a logical move. Some people say Microsoft was close to pulling the trigger, but suddenly and inexpiably walked away.

Shortly after that debacle, McAfee CEO George Samenuk departed and was replaced by DeWalt, the stylist, GQ executive out of EMC. DeWalt, at the time, pledged to make McAfee aggressive in both the channel and the general marketplace. After meeting him at Interop in 2007, I walked away saying that DeWalt was the most dangerous (in a good way) man in the security market.

When I spoke about DeWalt's ambition and energy with John Thompson, the then-chief of Symantec, he was dismissive. He didn't think DeWalt or McAfee had the ability to compete as a stand-alone security company. Symantec, he said by comparison, had diversified into storage and information management.

In the two years since, rumors have persisted about McAfee searching for a suitor. Some have said that DeWalt has approached every larger vendor in the business—including Cisco, Hewlett-Packard and EMC—about a merger. All, they say, turned him away. Insiders, speaking on condition of anonymity, said that McAfee needed to exit the market because its internal systems were antiquated and its management was more interested in pumping up valuation for sale than building value in the business. Partners had mixed feelings about McAfee, with many saying that McAfee was squeezing the margins out of software licenses.

Pretty gloomy picture, eh?

That was pretty much the state of McAfee up until about six months ago when the last round of merger talks subsided. Since then, there's been nothing but positive buzz and momentum.

Actually, the momentum started last fall with the $497 million acquisition of Secure Computing, which put McAfee back in the security hardware business and gave control of technology it sold five years earlier (the Gauntlet firewall, now the Sidewinder). Since the beginning of the year, McAfee has bought Solidcore Systems for $33 million, giving it well-performing whitelisting capabilities, and Endeavor Security, a company that made intelligence and reporting software for IDS/IPS.

>> Click here for a list of McAfee's acquisitions <<

On top of the acquisitions, McAfee has been busy building new and surprisingly innovative technology and reseller alliances. It signed a sweeping deal with HP, in which HP services—formerly EDS—will be able to resell its entire portfolio, and HP partners can get access to McAfee products. It also partners with EMC to develop secure remote backup technology.

While DeWalt says the MX Logic acquisition enhances McAfee's security SAAS position, the reality is it's virtually creating it. McAfee has been relatively late to the game on the managed services and SAAS build-up. Symantec, by comparison, got into that business back in 2003 when it bought RipTech and its cutting-edge security operations centers. Nevertheless, MX Logic is a smooth move on McAfee's part, giving it capacity, capabilities and customers in the managed security services space.

The argument against McAfee (and other security vendors) is that it will be nearly impossible for them to grow and compete without diversifying into nonsecurity markets. But if you look at the moves McAfee has made over the years, it's got one of the most impressive security portfolios in the business—risk and threat management (Foundstone), network-based intrusion prevention (IntruVert), host-based IPS (Entercept), patch management (Citadel), tokens and firewalls (Secure Computing), and data loss prevention (Reconnex). Oh, and it still has the market-leading anti-virus and endpoint security software suites and the powerful ePolicy Orchestrator management platform.

The proof is always in the financial performance. While rival Symantec reported weak quarterly financials, McAfee reported a record second quarter. McAfee's topline was $469 million, up 18 percent over the same period last year—marking the 14th straight quarter of growth.

“McAfee will continue to drive sales and build market share through an approach that bundles market leading solutions into suites; integrates management of this portfolio through our ePolicy Orchestrator management platform; and creates trusted advisor status with McAfee's security-only focus and world-class service and support,” DeWalt wrote in his blog.

This certainly doesn't sound like a CEO or a company ready to roll over.