Google’s ambitious plan to acquire Israeli cybersecurity firm Wiz for $23 billion has fallen through, a move that could significantly affect the tech industry’s landscape, particularly for Microsoft. Wiz CEO Assaf Rappaport announced the decision to decline the offer, stating that the company aims to achieve $1 billion in annual revenue and pursue an initial public offering (IPO).
The would-be acquisition was seen as a way for Google to enhance its cybersecurity capabilities, especially after the abrupt disruption in the cyber sector caused by a substantial outage from CrowdStrike last week. Analyst Dan Ives from Wedbush noted that concerns regarding investors and ongoing antitrust issues contributed to the deal’s failure. Google has faced significant scrutiny regarding antitrust matters and recently concluded a trial related to one of two significant cases brought by the Department of Justice.
Ives expressed that the breakdown of this deal might lead to broader implications for the cybersecurity sector. He anticipates that Google will focus on expanding its cybersecurity efforts despite the failed acquisition of Wiz. Similarly, he believes that Microsoft is likely to explore opportunities to strengthen its own cybersecurity portfolio in the coming months.
The need for Microsoft to enhance its cybersecurity measures has been underscored by a recent global IT outage linked to its software provider, CrowdStrike. This incident affected users worldwide, leading to significant disruptions in various sectors, including businesses and government operations. While Ives has described CrowdStrike as the “gold standard” of cybersecurity, the outage suggests that Microsoft may need to intensify its cybersecurity initiatives, especially following Google’s unsuccessful attempt to acquire Wiz.