McAfee Offers Refunds for a Faulty Software Update

Faced with a firestorm of complaints over its security software update debacle, McAfee (MFE) is rolling out a reimbursement and free subscription program as part of its mea culpa.

McAfee, a security software giant, is searching for a soft landing after its reputation was hit hard last week, following its release of a security update that turned on itself, taking aim at computers it was designed to protect. McAfee's DAT file 5958 mistakenly identified a piece of Windows code as a malicious virus, prompting a computer to reboot, and reboot, and reboot and reboot. Get the picture?

As a result, McAfee is trying to appease a number of corporate customers and a smaller smattering of consumers who were affected by the update, which rendered their systems running Windows XP with service pack 3 (SP3) inoperable or dramatically impaired.

McAfee is offering affected home and home-office customers refunds for "reasonable expenses" incurred if they hired a tech support specialist to address the problem, as well as a free two-year extension to their current McAfee subscription.

Workarounds and FAQs

Consumers account for roughly a third of McAfee sales -- a segment it's been fighting to retain since Microsoft (MSFT) stepped into the picture with its own security software baked into its operating system.

Corporate customers and businesses have a different offering, which entails a website that suggests possible workarounds, articles and an FAQ. No doubt companies severely affected by the debacle are having side conversations with the security software maker.

For technologists and industry observers, buggy software is nothing new. And in the corporate world, the job of keeping employees' computers up and running when installing software vendor updates is akin to working on LAPD's bomb squad -- the task can be done, but great care is needed or the whole computer network could blow.

McAfee investors, as well as shareholders of arch-rival Symantec (SYMC), may want to tune in Thursday to McAfee's first-quarter earnings call and webcast. The company may provide some insight into the economic impact its debacle will have on future earnings.