Google’s potential acquisition of Israeli cybersecurity startup Wiz for $23 billion has fallen through, creating significant implications for the tech industry, particularly for Microsoft. Wiz CEO Assaf Rappaport announced the decision to decline Google’s offer, citing a desire to focus on growing Wiz towards a goal of generating $1 billion in annual revenue and preparing for an initial public offering.
This acquisition would have strengthened Google’s cybersecurity division, especially following a major outage linked to industry leader CrowdStrike that impacted the cybersecurity landscape. Analyst Dan Ives of Wedbush noted that investor apprehensions and antitrust challenges contributed to the deal’s collapse. Google has been under substantial antitrust scrutiny recently and recently concluded a trial related to significant cases brought forth by the Department of Justice.
Ives suggested that the failure of the Wiz deal would have ripple effects across the sector, yet he believes Google will likely intensify its efforts to enhance its cybersecurity capabilities. He also indicated that Microsoft may take this opportunity to enhance its own cybersecurity platform within the next 12 to 18 months.
Microsoft’s prominent role in the recent global IT outage caused by a faulty update from CrowdStrike has highlighted the need for increased cybersecurity measures. Users reported widespread disruptions, including issues with Microsoft’s Windows systems as a result of the outage. Despite Ives stating that CrowdStrike remains the “gold standard” in cybersecurity, the incident may signal that Microsoft should strengthen its cybersecurity offerings, further opened up by Google’s failed acquisition.