Tuesday’s big news that Google gets Wiz Startup Security for a $ 32 billion record comes with a very big qualifier. Google says it will place Wiz as a “multicloud” offer, which means that Wiz will not be a store just for Google.
The reality is that Google had no choice but to do so and a closer look at the reasons behind the decision also highlights Google’s weak spots in the coming months.
Customer preservation
Wiz brings a huge list of customers to Google. As of today, startup has already reached an annual rate of $ 700 million. Before the news broke on Tuesday, it was on the right track to increase to $ 1 billion.
“Before the news switches” is the functional phrase here. Google and Wiz certainly hope that the acquisition will create an interesting new customer and revenue channel, but first of all, both will have to ensure that they keep existing customers from the market for another security provider.
Many of these customers are already using a cloud hybrid and may not use Google Cloud at all. One of the main reasons why some of them chose the Wiz in the first place was its ability to support multiple cloud platforms.
If Google cuts this skill, it is in danger of alienating these users.
That is why Wiz Assaf Rappaport’s CEO and other senior leaders called on customers in the hours that led to the deal, reassuring them that they were simply the usual.
Antitrust
When the news broke last summer that the alphabet/Google was trying to acquire Wiz, speculation quickly followed the regulatory challenges of promoting such a large deal. Google has been under strong antitrust for years, especially for its dominance in areas such as searching, operating systems and advertising.
The regulatory climate has been shifted since then. The US under President Trump has not yet heard a major affair of antitrust legislation and there are mixed views on how its administration will approach Big Tech. Some believe that large technology companies will still face barricades. Others believe that the Big-Deal window is open once again.
“That Google feels that it is able to think of the Big M&A again to look great in itself,” said one source. “Do they think they have the administration of Trump on his part?”
Meanwhile, in smaller but still important markets such as the United Kingdom, regulators have recently taken a more favorable stop in Big Tech as part of a wider push to signal that “the United Kingdom is open to business”. The so -called superstar can see this as an opportunity to get out of the shadows a little more.
Even if the regulatory climate remains difficult for the great M & A technology, Google’s “Multicloud” position can come useful. Cloud services and cyber security are not strongly two areas dominated by Google right now, so this deal can only increase alarm bells.
If the regulators hectare Looking at Google’s overall domination, emphasizing Wiz’s ability to work on different cloud platforms to help Google’s argument supporting competition.
Google Cloud can’t cover AWS and Azure
The ultimate reason why Google had to hug the Multicloud model is simple: many customers just don’t do it and will not use Google Cloud. From the quarter 2024, Statistical The data shows that AWS had a 30% share of the global cloud market, with Azure second with 21%. Google cloud routes behind 12%.
Why is Google so back? Some say it is because AWS got a previous start in the field. Others say that Microsoft’s dominance and the powerful ecosystem – including the corporate relationship Openai – gave him an advantage. Google does not have both advantages.
A few years ago, people wondered if Google could close the gap, as its cloud bids were comparable to AWS and Azure.
“Google Cloud has always been a mystery when it comes to their third place in the market share of Cloud Infrastructure,” says former writer TC Ron Miller TC today. “They manage the largest cloud applications in the world, but have found it difficult to translate it into business customers.”
He believes that he changed under his Google Cloud Thomas Kurian CEO. “He has much more credibility with business customers,” Miller says. “They’ve grown up quickly over the last two years and have a pretty substantial business, but still far behind Amazon and Microsoft in terms of revenue.”
During an investor call on Tuesday, Kurian stressed that Google has sought Wiz because of its capabilities, saying: “Multicloud is something our customers want to lock in a vendors.
But Kurian also believes that AI can change the game.
AI architectures may cause large businesses to gather data from multiple parts to a central cloud provider, Kurian said. If this happens, then multiple element protection may become less critical, but security for the central memory of their data will be.
Until then, Multicloud is the step to “help customers identify, protect and defend cyber threats in all major clouds and even on -site systems,” Kurian said.
Now we will see if regulatory authorities and end users buy it.
