Google’s attempt to acquire Israeli cybersecurity startup Wiz for $23 billion has fallen through, a decision announced by Wiz CEO Assaf Rappaport. He stated that turning down the offer was a tough but necessary choice to focus on growing Wiz’s revenue to $1 billion and preparing for an initial public offering.
The anticipated acquisition would have significantly strengthened Google’s cybersecurity capabilities, especially in light of a recent massive outage from cybersecurity firm CrowdStrike, which disrupted operations for various sectors, including businesses and government. Following the news of the deal collapsing, Wedbush analyst Dan Ives highlighted investor concerns and existing antitrust issues as key reasons for the failed acquisition. Google has faced intense scrutiny from regulators, recently concluding a trial related to antitrust allegations.
Ives predicts that the impact of this deal not materializing will reverberate through the tech industry. He suggested that Google will likely continue to enhance its cybersecurity initiatives, a sentiment that also applies to its competitor Microsoft. Ives opines that consolidation within the cybersecurity space is overdue, and he anticipates that Microsoft may actively seek to bolster its own cybersecurity offerings in the next 12 to 18 months.
Microsoft recently faced scrutiny related to a global IT outage that resulted from a malfunctioning update in its cybersecurity software supplied by CrowdStrike. This incident raised concerns over the effectiveness of Microsoft’s cybersecurity measures, further emphasizing the need for the company to enhance its capabilities, especially as opportunities arise with Google’s failed acquisition.