Google’s bid to acquire the Israeli cybersecurity startup Wiz for $23 billion has fallen through, which is expected to have significant repercussions in the tech industry, particularly for Microsoft. Wiz CEO Assaf Rappaport announced on Tuesday that he declined the offer, opting instead to focus on achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
The acquisition would have enhanced Google’s cybersecurity capabilities, particularly following a major outage last week linked to CrowdStrike, another significant player in the sector. Wedbush analyst Dan Ives indicated that issues related to investor concerns and antitrust scrutiny contributed to the deal’s collapse. Google is currently facing considerable antitrust challenges, having recently concluded a trial in one of two high-profile cases initiated by the Department of Justice.
Ives noted that the failure of the Wiz acquisition could create ripple effects throughout the industry. He believes that Google will continue to intensify its efforts to expand its cybersecurity offerings, and he also anticipates that Microsoft will pursue similar strategies.
He explained that there is a pressing need for consolidation within the cybersecurity realm, and Microsoft could potentially seek to enhance its own cybersecurity platform in the coming year to eighteen months. This prediction follows a recent incident where a faulty update to CrowdStrike’s software led to widespread outages, affecting various sectors including business and government operations. Although Ives maintains that CrowdStrike remains a leader in cybersecurity, this troubling event underscores the necessity for companies like Microsoft to strengthen their cybersecurity measures, particularly in light of Google’s failed acquisition.