Wiz’s decision to walk away from a potential $23 billion acquisition by Google could have significant repercussions for the technology sector, particularly for Microsoft. The Israeli cybersecurity startup turned down Google’s offer to focus on achieving $1 billion in annual revenue and preparing for an initial public offering, according to CEO Assaf Rappaport.
This acquisition would have enhanced Google’s position in cybersecurity, especially following a recent major outage linked to CrowdStrike, a key player in the industry. Dan Ives, an analyst at Wedbush, noted that concerns from investors and ongoing antitrust issues played a role in the collapse of the deal. Google has faced increased scrutiny from antitrust regulators in recent years and recently concluded a trial related to these issues.
Ives stated that the failure of the Wiz acquisition would create ripple effects throughout the industry. He believes that Google will continue to strengthen its cybersecurity capabilities despite this setback and that Microsoft might capitalize on this opportunity.
He outlined the expectation for consolidation within the cybersecurity sector and suggested that Microsoft could take action to enhance its own cybersecurity offerings in the next year to 18 months. This comes in light of recent challenges Microsoft faced due to a widespread IT outage related to a Crowdstike software update, which affected users globally and impacted various sectors.
While Ives maintains that CrowdStrike is still considered a top tier cybersecurity provider, the outage suggests a growing need for Microsoft to bolster its cybersecurity operations, and Google’s failure to acquire Wiz could pave the way for such developments.