Wiz’s decision to withdraw from a potential $23 billion acquisition by Google could significantly impact the tech landscape, particularly affecting Microsoft. The Israeli cybersecurity firm Wiz, led by CEO Assaf Rappaport, opted to reject Google’s offer in favor of pursuing its growth goals, aiming for $1 billion in annual revenue and preparing for an initial public offering (IPO).
This acquisition was expected to enhance Google’s cybersecurity capabilities, especially following a major outage caused by CrowdStrike, a leading cybersecurity firm, last week. According to Wedbush analyst Dan Ives, the failure of the deal was influenced by investor apprehension and ongoing antitrust concerns, as Google continues to face scrutiny from regulatory bodies after wrapping up a key trial with the Department of Justice.
Ives noted that the collapse of this deal could create ripple effects throughout the cybersecurity sector. He anticipates that despite losing out on Wiz, Google will intensify efforts to expand its cybersecurity capabilities. Concurrently, he suggests that Microsoft may seek to strengthen its own cybersecurity offerings in the next year to 18 months.
This comes after Microsoft experienced a difficult moment during a recent widespread IT outage linked to a faulty update from CrowdStrike, which is integral to its security system. Users reported encountering critical errors, leading to disruptions in various sectors, including business and government operations. While Ives maintains that CrowdStrike is still a leading player in cybersecurity, this incident underscores the urgency for Microsoft to enhance its cybersecurity measures, a gap that the failed Wiz acquisition highlights further.