In the event of reshaping the cybersecurity landscape for cloud computing, Google’s $32 billion deal with Wiz is subject to antitrust reviews of U.S. officials. This acquisition, which is one of the largest Google has made ever–is currently under examination of the watchdogs, who are assessing the potential impact on competition in the marketplace and the choice of consumers.

The Deal at a Glance

Google is in talks for the acquisition of Wiz which is a rapidly growing Israeli cybersecurity company, in an $32 billion cash-only deal. Wiz is a leading provider of solutions to protect cloud data, and its rapid growth has made it an prominent company in the cloud security market.

The acquisition aims to improve the Google Cloud’s security infrastructure, as it faces off against Amazon AWS and Microsoft Azure.

 External Source: Bloomberg Coverage
External Source: TechCrunch Wiz Profile

Why Is the FTC Involved?

The $32 billion Google acquisition for Wiz receives an antitrust review due to the growing concern by global regulators regarding Big Tech consolidation.

The Federal Trade Commission (FTC) has requested additional documents under the Hart-Scott-Rodino Act which indicates that a second-phase review is expected. The review will determine if this acquisition will cause harm to legitimate competition within the cybersecurity and cloud sectors.

Regulators have a particular focus on:

•   It is unclear if Google is gaining unfair advantage within the market for multi-cloud security

•   There are concerns about the lack of options available to enterprise customers

•   The impact of cybersecurity on smaller startups and innovations

What’s at Stake?

If the deal goes through it could be an momentous change in the dominance of cloud security. Wiz has recently surpassed an estimated value of $10 billion and has grown more quickly than any other company in its field, and is serving high-end clients like Morgan Stanley, Salesforce, and BMW.

If regulators reject the deal, it could be a sign of the possibility of a more general resentment towards Big Tech expansion in crucial infrastructure sectors.

 “This review could become a landmark case in defining antitrust limits in the cybersecurity market,” claimed the tech analyst Elena Brooks.

Industry Reactions

Market analysts are divided. Some view the move as a natural progression of cloud competition, but others think it could restrict innovation and limit the variety of vendors.

Cloud rivals like Microsoft as well as Oracle are watching the situation. If they are blocked, the outcome could inspire smaller players and impact how big tech companies approach the acquisition process in the future.

Final Word

While the $32 billion contract between Google and Wiz to acquire Wiz receives an antitrust investigation this matter has been viewed as an important test to determine the extent of consolidation regulators can allow in high-risk digital infrastructure sectors. In the event that this deal goes through or is rejected and if it is, it’s likely to set an example.

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