Wiz’s decision to withdraw from a proposed $23 billion acquisition by Google could have significant consequences for the tech sector, particularly impacting Microsoft. The Israeli cybersecurity startup Wiz, led by CEO Assaf Rappaport, opted against the buyout to focus on its goal of achieving $1 billion in annual revenue and preparing for an initial public offering.
This acquisition would have strengthened Google’s cybersecurity efforts amid heightened industry concerns following a major outage at CrowdStrike last week. Analyst Dan Ives from Wedbush pointed out that investor apprehensions, along with antitrust issues, contributed to the collapse of the deal. Google has faced rigorous antitrust scrutiny recently and has just concluded a trial linked to significant cases initiated by the Department of Justice.
Ives noted that the failure of this acquisition is likely to create ripple effects throughout the industry. He anticipates that Google will persist in expanding its cybersecurity presence despite losing out on Wiz. Similarly, he believes Microsoft will also seek opportunities to enhance its cybersecurity portfolio in the next year to year and a half.
Microsoft recently faced scrutiny of its own due to a global IT outage triggered by a problematic update in CrowdStrike’s cybersecurity software, which affected operations worldwide. Despite being regarded as the “gold standard” in cybersecurity, CrowdStrike’s failure amid this incident raises questions about the need for Microsoft to strengthen its cybersecurity capabilities further, especially following the missed opportunity with Wiz.