Wiz’s decision to withdraw from a potential acquisition by Google could have significant ramifications for Microsoft, according to an analyst.
Google had intended to acquire the Israeli cybersecurity firm Wiz for $23 billion, but Wiz CEO Assaf Rappaport announced the rejection of the offer, opting instead to focus on achieving $1 billion in annual revenue and preparing for an IPO. This decision comes at a crucial time, as Google’s cybersecurity efforts are underlined by recent concerns in the industry following a major incident involving CrowdStrike.
Wedbush analyst Dan Ives noted that worries among investors and ongoing antitrust challenges contributed to the collapse of the deal. Google is currently facing heightened scrutiny regarding its business practices, having recently concluded a trial related to antitrust concerns from the Department of Justice.
Ives predicted that the fallout from the failed acquisition would create ripple effects within the cybersecurity sector. He anticipates that Google, undeterred by the missed opportunity with Wiz, will continue to enhance its cybersecurity capabilities. Similarly, Microsoft may seize this moment to consider consolidating its own security offerings in the next 12 to 18 months.
The recent global IT outage stemming from a flawed update in CrowdStrike’s software has further spotlighted Microsoft. Reports of system failures from users worldwide highlighted vulnerabilities and raised questions about the robustness of Microsoft’s cybersecurity strategies. Although Ives continues to regard CrowdStrike as a leading cybersecurity provider, he suggests that the incident could indicate the necessity for Microsoft to strengthen its own cybersecurity platform, especially in light of Google’s unsuccessful acquisition.