Wiz’s decision to decline Google’s acquisition offer could significantly impact Microsoft and the tech industry as a whole.
Google had aimed to acquire the Israeli cybersecurity startup Wiz for $23 billion, but the deal was rejected by Wiz’s CEO, Assaf Rappaport. He stated that this “tough” decision was made to focus on building Wiz towards its goal of achieving $1 billion in annual revenue and preparing for an initial public offering (IPO).
The acquisition would have strengthened Google’s cybersecurity efforts following a major outage attributed to CrowdStrike, another giant in the field which occurred last week. Wedbush analyst Dan Ives noted that concerns among investors and ongoing antitrust issues contributed to the deal’s failure, particularly as Google faces intense scrutiny over its market practices and has recently concluded a significant trial related to antitrust issues.
Ives emphasized that the absence of this deal would create ripple effects throughout the tech sector. He expressed confidence that Google would continue to focus on expanding its cybersecurity capabilities despite this setback, and indicated that Microsoft might also seek to enhance its own cybersecurity framework in the near future.
Microsoft, which faced criticism due to the wide-reaching IT outage linked to a faulty cybersecurity update from CrowdStrike, is under pressure to improve its cybersecurity offerings. The reports of widespread issues, including the notorious “blue screens of death,” have raised awareness regarding cybersecurity among its user base globally.
Ives pointed out that while CrowdStrike remains highly regarded in the cybersecurity field, the recent outage suggests that Microsoft should prioritize its cybersecurity advancements, and the collapse of the Google-Wiz deal intensifies those possibilities.