Wiz’s decision to back out of a potential $23 billion acquisition by Google could have significant repercussions for the tech industry, particularly for Microsoft. The Israeli cybersecurity startup Wiz, led by CEO Assaf Rappaport, opted to reject Google’s offer in favor of focusing on achieving $1 billion in annual revenue and pursuing an IPO.
Analysts note that this move would have strengthened Google’s cybersecurity division, especially following a recent major outage linked to CrowdStrike, a leading cybersecurity firm. Dan Ives, an analyst at Wedbush, indicated that investor unease and antitrust concerns were key factors in the deal’s failure. Google has faced rigorous antitrust scrutiny and recently concluded a trial related to these issues.
Ives predicted that the absence of the Wiz deal would create notable ripple effects throughout the cybersecurity sector. He suggested that Google would likely intensify its efforts to enhance its cybersecurity capabilities and that Microsoft might consider expanding its own cybersecurity initiatives over the next year to 18 months.
Microsoft recently found itself under scrutiny due to the widespread disruption caused by a problematic update to its cybersecurity software, which is provided by CrowdStrike. This incident led to reports of system failures among Microsoft users globally. Despite these challenges, Ives maintained that CrowdStrike remains a leader in cybersecurity, but the situation may prompt Microsoft to invest further in strengthening its cybersecurity offerings, particularly in light of the void left by the failed Google-Wiz deal.