Wiz’s decision to back out of a $23 billion acquisition by Google could have significant consequences for Microsoft and the broader tech landscape. Wiz, an Israeli cybersecurity startup, declined Google’s offer with the intention of focusing on achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
This acquisition would have strengthened Google’s position in the cybersecurity sector, particularly following a recent major outage linked to CrowdStrike, which highlighted vulnerabilities in the industry. Wedbush analyst Dan Ives noted that factors such as investor concerns and ongoing antitrust issues contributed to the deal’s collapse. Google has faced rigorous antitrust scrutiny and recently concluded a trial stemming from significant legal challenges by the Department of Justice.
Ives stated that the failed deal is likely to have ripple effects across the tech sector. He anticipates that Google will intensify efforts to expand its cybersecurity capabilities despite the setback. He also mentioned that Microsoft may viewing this situation as an opportunity for consolidation in the cybersecurity domain, potentially leading the company to enhance its own platform within the next year to 18 months.
The recent global IT outage, resulting from a problematic update to CrowdStrike’s software used by Microsoft, brought additional attention to the necessity of bolstering cybersecurity measures. Despite Ives describing CrowdStrike as a “gold standard” in cybersecurity, the disruption may prompt Microsoft to strengthen its cybersecurity offerings further, especially in light of Google’s unsuccessful venture with Wiz.