Wiz’s decision to decline Google’s acquisition offer has significant repercussions for the technology sector, particularly for Microsoft.
Google was in talks to purchase the Israeli cybersecurity startup Wiz for $23 billion, but Wiz’s CEO Assaf Rappaport announced on Tuesday the decision to reject the offer. He cited a desire to focus on growing Wiz into a company that could generate $1 billion in annual revenue and pursue an initial public offering (IPO).
The failed acquisition would have strengthened Google’s cybersecurity capabilities, especially in light of a recent major outage attributed to CrowdStrike that affected numerous organizations. Analyst Dan Ives from Wedbush noted that concerns from investors and ongoing antitrust issues played a key role in the deal’s collapse. Google has faced increased scrutiny from regulators and recently completed a trial related to antitrust matters.
Ives emphasized that the fallout from this deal’s failure could ripple across the industry, suggesting that Google will likely intensify its efforts to expand its cybersecurity services. Similarly, he predicted that Microsoft may look to enhance its cybersecurity platform in the next year to 18 months due to the current landscape.
Additionally, Microsoft faced criticism after a global IT outage caused by a problematic update to software provided by CrowdStrike, which notably affected its operating systems. Users experienced widespread issues, including the infamous “blue screens of death.” While Ives maintains that CrowdStrike remains a leader in cybersecurity, the outage underlines the necessity for Microsoft to strengthen its cybersecurity offerings, a sentiment that may be amplified by the collapse of the Wiz deal.