Google’s attempted acquisition of Israeli cybersecurity startup Wiz, valued at $23 billion, has fallen through, carrying significant implications for the tech landscape, particularly for Microsoft. Wiz’s CEO, Assaf Rappaport, shared that the decision to decline was challenging but necessary for the company’s goal of reaching $1 billion in annual revenue and pursuing an initial public offering.
The failed acquisition comes shortly after a significant disruption in the cybersecurity sector caused by a major outage linked to CrowdStrike. Analyst Dan Ives of Wedbush noted that concerns regarding investor sentiment and ongoing antitrust issues led to the collapse of the deal. Google’s persistent scrutiny over antitrust matters has intensified, notably after concluding a major trial with the Department of Justice.
Ives predicted that the absence of this deal would have broader consequences throughout the industry. Despite the setback with Wiz, he believes Google will continue to focus on bolstering its cybersecurity presence, a move likely mirrored by Microsoft. He emphasized the necessity for consolidation in the cybersecurity arena and suggested that Microsoft might seek to enhance its cybersecurity platform within the next year to 18 months.
Microsoft recently experienced scrutiny when a global IT outage was traced back to a problematic update from CrowdStrike, which it employs to safeguard its systems. This incident not only affected Microsoft users internationally, leading to widespread disruptions, but also underscored the vulnerabilities in current cybersecurity solutions. Ives affirmed that while CrowdStrike remains a top performer in the field, the recent issues highlight the importance for Microsoft to strengthen its cybersecurity offerings, and Google’s failed acquisition may further enable this shift.