Wiz’s decision to reject Google’s acquisition proposal could have significant repercussions for the technology sector, particularly for Microsoft.
Google had intended to acquire Israeli cybersecurity startup Wiz for $23 billion, but on Tuesday, Wiz CEO Assaf Rappaport announced that the company would not proceed with the deal. Rappaport stated that turning down the substantial offer was a difficult choice made to focus on building Wiz towards its goal of generating $1 billion in annual revenue and pursuing an initial public offering (IPO).
This acquisition would have strengthened Google’s cybersecurity efforts, especially following a recent major outage affecting CrowStrike, a leading player in the cybersecurity field. Analyst Dan Ives from Wedbush mentioned that concerns from investors and ongoing antitrust challenges were instrumental in the deal’s failure. Google has faced intense antitrust examination recently and has concluded its trial related to one of two significant cases brought by the Department of Justice.
Ives noted that the absence of this deal is likely to have widespread effects across the sector. He anticipates that Google will continue its aggressive push to enhance its cybersecurity capabilities, and Microsoft may follow suit.
Ives expressed that consolidation in the cybersecurity industry is overdue, suggesting that Microsoft may seek to strengthen its cybersecurity platform within the next 12 to 18 months.
Recently, Microsoft was under scrutiny after a major global IT outage linked to a faulty update of its cybersecurity software from CrowdStrike. This incident prompted complaints from users worldwide, highlighting the need for improvement in Microsoft’s cybersecurity measures. With Google’s failed acquisition of Wiz, the opportunity for Microsoft to enhance its cybersecurity strategy has broadened.