Google’s attempt to acquire the Israeli cybersecurity startup Wiz for $23 billion has come to an abrupt end, potentially reshaping the tech landscape and impacting its rival, Microsoft. Wiz CEO Assaf Rappaport announced on Tuesday that the company rejected Google’s proposal to focus on achieving $1 billion in revenue and preparing for an initial public offering.
This acquisition would have strengthened Google’s cybersecurity division, especially in the wake of a significant outage caused by CrowdStrike, a major player in the industry, just days earlier. According to Wedbush analyst Dan Ives, the failure of the deal can be attributed to investor apprehensions and ongoing antitrust concerns surrounding Google, which has faced heightened scrutiny and recently concluded a major trial with the Department of Justice.
Ives indicated that the repercussions of this acquisition falling through will be felt across the tech sector, suggesting that Google will likely intensify efforts to enhance its cybersecurity strategies despite losing the Wiz deal. Meanwhile, Microsoft is also expected to pursue similar objectives.
Ives mentioned that there is a pressing need for consolidation within the cybersecurity sector, and he anticipates that Microsoft may seek to strengthen its cybersecurity offerings in the next 12 to 18 months. The recent global IT outage, caused by a problematic update in CrowdStrike’s software, highlighted vulnerabilities in cybersecurity measures used by Microsoft, emphasizing the necessity for improvements in this area. While CrowdStrike maintains its status as a leader in cybersecurity solutions, the incident indicates that Microsoft may need to bolster its own cybersecurity capabilities following the missed opportunity with Wiz.