Google’s plan to acquire Israeli cybersecurity startup Wiz for $23 billion has fallen through, which could have significant implications for the technology sector, particularly for Microsoft. Wiz CEO Assaf Rappaport announced the difficult decision to reject the acquisition to focus on achieving $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 caused by CrowdStrike that shocked the industry last week. Analyst Dan Ives from Wedbush noted that investor worries and antitrust issues contributed to the deal’s collapse. Google is currently facing intense scrutiny concerning its business practices and has recently concluded a trial related to one of two significant cases brought by the Department of Justice.
Ives commented on the broader impact of the failed acquisition, suggesting that it could ripple across the cybersecurity sector. He anticipates that Google will continue to expand its cybersecurity operations despite losing the opportunity with Wiz. Microsoft is also expected to focus on enhancing its own cybersecurity platform over the next 12 to 18 months.
The recent CrowdStrike outage, which impacted Microsoft’s Windows systems by causing widespread disruptions, has highlighted vulnerabilities in the tech giant’s cybersecurity measures. While Ives maintains that CrowdStrike remains the top choice for cybersecurity, the incident may indicate a pressing need for Microsoft to bolster its security capabilities, with competitions in the sector intensifying as a result of Google’s failed acquisition efforts.