Wiz’s decision to withdraw from the proposed $23 billion acquisition by Google has significant implications for the tech industry, particularly for Microsoft. The Israeli cybersecurity startup, led by CEO Assaf Rappaport, declined the major offer on Tuesday, opting instead to focus on growing its revenue to $1 billion annually and pursuing an initial public offering (IPO).
The deal’s collapse is particularly notable following a recent massive outage caused by CrowdStrike, a key player in the cybersecurity sector. Following this development, Wedbush analyst Dan Ives indicated that investor concerns and antitrust challenges played a critical role in the deal’s failure. Google has faced increased antitrust scrutiny and recently concluded a trial related to federal concerns.
Ives suggested that the breakdown of the acquisition could lead to wider repercussions within the cybersecurity industry, asserting that Google is likely to intensify efforts to enhance its cybersecurity initiatives, as will its competitor Microsoft.
He believes consolidation in the cybersecurity market is necessary, and he expects Microsoft to pursue strengthening its own cybersecurity offerings within the next year and a half. This comes after a global IT outage linked to a faulty update from CrowdStrike impacted numerous Microsoft users, causing widespread disruptions across various sectors.
While Ives still regards CrowdStrike as a leading cybersecurity provider, he posits that the incident may highlight the need for Microsoft to enhance its cybersecurity capabilities, leaving room for future developments following the failed Google-Wiz deal.