That question was answered Friday when Apple announced it had spent an estimated $356 million to acquire AuthenTec (AUTH)
But it's much more than that.
One of the key areas of AuthenTec's expertise is providing security for a near-field communication-based mobile e-wallet. This supports previous rumors that Apple was interested in an e-wallet functionality for its mobile devices, particularly in the upcoming launch of its IOS6 featuring its new app, Passbook.
What's more, there were growing concerns about Apple's adoption of Facebook
However, in its adoption of Facebook, Apple risks acquiring Facebook security concerns -- integration works in both directions. For example, when a user adds an event in his/her Facebook calendar and has anniversaries or birthdays of friends on Facebook, they also appear on the user's iPhone's calendar, to the extent that it can even pop up as a reminder.
Even more remarkable is that as friends on Facebook update their contact information, that new change will sync with the contact list on the user's iPhone. That's all well and good, but here's are the problems: Security and privacy.
For years, Apple prided itself on how secure its machines have been when compared to its PC rivals. With the Facebook move, it might have lost that distinction.
Apple is betting that a great percentage of Facebook's over 900 million users will buy iPhones over other Android, Samsung or Windows devices, but at what cost? With the increase in volume comes greater threats as Facebook will "always be active" on Apple devices. What's more, if a threat can easily enter Facebook, what will stop it from possibly infecting the iPhone calendar, contacts, and even mail?
Now, with the tools offered by AuthenTec, Apple can easily secure its devices and its IOS. What's more, it also eliminates a popular argument from Research In Motion
That's simply no longer true. One of the many strengths of AuthenTec is that its QuickSec Mobile VPN Client product that helps users connect their devices to enterprise networks. This is going to be especially beneficial due to the wide adoption of BYOD.
Some other areas to consider: AuthenTec owns an estimated 200 patents in the areas of fingerprint sensors and sensor packaging as well as end use. What's more, it seems that Apple understands how vital personal information is on iPhones and iPads.
Oh, and it goes without saying that all of Apple's rivals that once benefited from AuthenTec's technology -- namely Samsung -- better beware. They likely will be looking for an alternative.
The question will be, did Apple overspend in the acquisition? According to documents, Apple is paying $8 per share, representing a premium of 58% above AuthenTec's most recent closing price of $5.07. As of this writing AuthenTec's stock is up 61% to $8.19.
However, Apple knows what it wants and I suspect the fact that AuthenTec had secured deals with many of Apple's rivals placed it in a position of leverage , so there is likely more to this deal than meets the eye. Overall, it was a great move for Apple and one that it had to do.
At the time of publication, the author was long AAPL and held no position in any of the other stocks mentioned.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.