Firewall vendor NetScreen has agreed to buy Neoteris, a leading vendor of “clientless” virtual private networks (VPNs), for about $265 million. The agreement shows that security companies are looking to cover more bases and simplify the range of technology required to keep networks secure.

VPNs are big business because they make secure tunnels from remote systems to corporate applications. While most VPNs currently use specific client software (IPsec) on a laptop PC, clientless VPNs use the secure sockets layer (SSL) in web browsers, so users can get to their corporate systems securely from any web browser, perhaps at an Internet cafe, or a partner’s office.

Clientless VPNs have got the analysts excited: research firm Infonetics estimates the market for them will exceed $600 million by 2006. “While IPSec is the best technology for site-to-site VPN deployments, we believe Neoteris’ advanced SSL VPN solutions will become the preferred solution for new, and expansion of existing, remote access deployments,” said Robert Thomas, president and CEO of NetScreen. Other SSL VPN vendors include Aventail, SafeWeb and Whale Communications.

NetScreen could eventually build Neoteris’ technology into its firewall products. But it will start out by integrating the management of the two products, while keeping the two ranges separate, when the merger goes through, according to Peter Crowcombe, marketing director EMEA for NetScreen: “SSL VPNs are normally deployed for a specific application, in a medium or large organisation,” he said. “These companies are already running their firewalls at near capacity, so it is best to add a separate box for the VPN.” When SSL VPNs penetrate to smaller organisations, it will probably make sense to add the functionality to a general purpose firewall appliance, he said.

The acquisition underlines the arrival of NetScreen as a middle-weight security player, more likely to be buying up innovative companies than being bought itself. “The really good thing is Neoteris is the leader in its space, shipping a lot of products, but they haven’t had a massive worldwide rollout,” said Crowcombe. “We can leverage our international structure.” A year ago, the company bought intrusion detection company OneSecure for $40 million. We may be near the start of an acquisition binge on SSL VPN companies, with F5 buying Uroam in July. Meanwhile, Nokia has launched a homegrown product, and Nortel Networks is expected to announce one soon. However, things have not all been rosy, as Aspelle closed in August, having failed to get a second round of venture funding.

Neoteris’ claim to have a million users worldwide, might make it the leader, though this is likely to be based on concurrent user licences sold, not active users. Aventail – which launched a new version of its SSL VPN product today – has about the same number of customers (500) and reckons it has half a million users.

Neoteris also has application-level software including single sign-on, which NetScreen will find very useful. Krishna “Kittu” Kolluri, president of Neoteris, will join NetScreen as general manager for NetScreen’s secure access products.