Wiz’s decision to decline Google’s acquisition offer could significantly affect Microsoft and the broader tech landscape.
Google’s plan to acquire Israeli cybersecurity firm Wiz for $23 billion has fallen through, as Wiz’s CEO Assaf Rappaport chose to reject the proposal. Rappaport described the decision as “tough,” indicating his commitment to focusing on building Wiz towards an annual revenue target of $1 billion and preparing for an initial public offering.
This acquisition would have enhanced Google’s cybersecurity capabilities, particularly following a notable outage experienced by CrowdStrike, a major player in the industry, just last week. Analyst Dan Ives from Wedbush noted that concerns over investor sentiment and antitrust challenges contributed to the deal’s demise. Google is currently facing significant antitrust scrutiny and has recently concluded a trial tied to one of two lawsuits filed by the Department of Justice.
Ives suggested that the failure of the acquisition might create ripple effects throughout the tech sector. Despite the setback, he believes that Google will continue to focus on expanding its cybersecurity operations, a trend that Microsoft is also likely to pursue.
Ives expects that Microsoft may look to consolidate within the cybersecurity industry to enhance its own cybersecurity platform over the next year to 18 months. The company has recently found itself under scrutiny following a global IT outage linked to a problematic update in its cybersecurity software from CrowdStrike. Reports of the famous “blue screens of death” flooded in from Microsoft users worldwide, impacting business operations, flights, and government services.
While acknowledging CrowdStrike’s status as a leading cybersecurity provider, Ives indicated that the recent outage could highlight a need for Microsoft to strengthen its security measures, with Google’s unsuccessful acquisition potentially paving the way for new opportunities.