Trend Micro expects network antivirus services to grow to make up a quarter of its revenue in three years as the threat posed by network worms such as Sasser continues to grow, according to the company's chief executive officer (CEO).

The company recently began selling its first hardware device designed to keep networks functioning while minimizing the disruption caused by computer worms. Recently, it announced a deal with Cisco Systems that will see the same signature-based worm-blocking technology built into Cisco's products.

The system can be managed remotely by Trend Micro and such services are likely to become a key business area for the future, CEO of Trend Micro, Steve Chang, said in an interview.

"Our core competence and our bread and butter in the future is services," Chang said. "I think the income from services will become very important."

Income from network-related antivirus services accounts for about 8 per cent of Trend Micro's total revenue, but Chang said he expected this to grow to 25 per cent within the next three years.

Last year the company reported annual revenue of $US436 million.

Chang said he expected demand for network antivirus protection and services to grow as the threat from worms increases and computer networks continue to expand in complexity.

For the last 16 years viruses had largely spread through infected files but that was changing with the emergence of network viruses such as Nimda, Slammer, MSBlaster and Sasser, Chang said.

"The biggest problem for IT managers for the last two years has been that no matter what kind of security product they bought, it doesn't work against these [types of viruses]," Chang said. "So Trend Micro spent about $US100 million to study this problem and finally, two months ago, announced our solution. It works at the network layer so that it can stop the virus and isolate it in the subnet."

The system works by attempting to contain any problems caused by a worm in a particular part of the network rather than let it spread throughout an entire system.

"When you get hit -- which is inevitable, they are coming in anyway -- the network will work," Chang said. "Once you contain the problem, even if you get hit your network continues to work."

Disruption and delay to network traffic is minimal with Trend Micro's system in place because it only begins to analyse packets when it detects an attack may be under way, he said.

At that time the traffic was being slowed anyway, and the network might be in danger of being overloaded, so any additional delays introduced to solve the problem were usually not a concern to network managers, Chang said.

Trend Micro's focus also extends to home users and in this area the company has been working with partners other than Cisco, Chang said.

Its technology was in a broadband home gateway product demonstrated by Zyxel Communications at the Cebit trade show in Germany in March and work with Taiwan's Hon Hai Precision Industry was presented at the recent Computex show in Taipei.