Google’s attempt to acquire Israeli cybersecurity startup Wiz for $23 billion has fallen through, which could have significant repercussions for the tech industry, particularly for Microsoft.
Wiz CEO Assaf Rappaport announced on Tuesday that the company had decided to reject Google’s offer in favor of focusing on growing its annual revenue toward $1 billion and preparing for an initial public offering (IPO). This decision came shortly after a major outage caused by CrowdStrike, a prominent player in the cybersecurity sector, raising further concerns regarding cybersecurity reliability.
Wedbush analyst Dan Ives noted that concerns from investors and antitrust issues were influential in the breakdown of the deal, highlighting Google’s ongoing legal hurdles regarding antitrust scrutiny from the Department of Justice.
Ives mentioned that the canceled acquisition would have ripple effects throughout the industry, but he anticipates that Google will intensify its efforts to expand its cybersecurity capabilities despite this setback. He also speculated that Microsoft might seek to enhance its own cybersecurity platform in the upcoming year to address weaknesses exposed by the recent outage involving CrowdStrike’s software.
The outage, which was attributable to a problematic update from CrowdStrike used in Microsoft’s Windows systems, led to widespread disruptions, impacting businesses, flights, and government operations. Even though Ives regards CrowdStrike as a leader in cybersecurity, the event may indicate a pressing need for Microsoft to strengthen its cybersecurity offerings as the competitive landscape shifts following Google’s failed acquisition attempt.