Google’s March 18 announcement that it has signed an agreement to buy Wiz, Inc., a leading cloud security platform headquartered in New York City, for $32 billion will be scrutinized by antitrust regulators in the United States and Europe. For U.S. regulators, the decision is a no-brainer – they should promptly approve it.
The Trump Administration should go further and urge European Union (EU) regulators to swiftly approve it, without conditions, as well. This is consistent with policies the administration has already clearly and strongly put forward to prevent EU meddling and harassment of U.S. companies and to ensure that America remains the world’s leading provider of AI.
In fact, a closer examination of the basics reveals that this transaction will promote greater competition within the United States and international tech sectors, better protect U.S. companies and government agencies from cyberattacks, and help strengthen America’s lead in AI.
Wiz’s story is powerful and inspiring, a case study proving that innovation, risk-taking, and entrepreneurialism thrived despite being under attack during the Biden years and the Hamas terrorist attack, and that the U.S. is indeed on the verge of a golden age.
Wiz was founded in January 2020 in Israel, just before the COVID-19 pandemic struck, by four former members of the Israel Defense Forces (IDF). They served in a unit responsible for code decryption, counterintelligence, cyberwarfare, and other high-tech military tools. Led by Assof Rappaport, the same team of four founded Adallom, a cloud security company, in 2012, which Microsoft acquired in 2015.
Wiz kept its engineering operations in Israel but relocated its headquarters to New York City, enabling it to better serve its wide array of U.S. and international customers.
Its suitor, Google Cloud, is a leader in providing infrastructure and platform services, applications, and other services including AI infrastructure, cybersecurity, data and analytics, and more.
According to Google’s press release, the aim of the acquisition is “to accelerate two large and growing trends in the AI era: improved cloud security and the ability to use multiple clouds.”
The mission for the merged organizations will span both the cybersecurity and cloud computing industries, each of which has a plethora of competitors and new entrants. The breadth of competitors across these vertical industries, that is, different areas of the tech supply chain, is vast.
According to the IT-Harvest Dashboard, there are more than 4,000 cybersecurity vendors worldwide. A Synergy Research Group analysis found Google Cloud has a 12 percent market share in the worldwide cloud infrastructure market. Competitors include Amazon Web Services, Azure, IBM, and Oracle.
Gartner also lists eight direct competitors to Wiz, including CrowdStrike Falcon Cloud Security. And Google Cloud’s customers will still have a number of different cybersecurity service options from Google itself in addition to Wiz.
Rather than inhibiting competition, the transaction will enable Google and Wiz to innovate more quickly together.
While the EU is all but certain to raise objections regardless, it would better serve its people by making fundamental changes to promote tech and other innovations, so it is no longer a tech wasteland. Former European Central Bank President Mario Draghi addressed this issue in a comprehensive report submitted to the EU in September.
Today, tiny Israel, a country of seven million people amid a devastating war, has not only managed to keep its tech sector thriving by creating a climate that welcomes entrepreneurialism but to crush Europe in tech competition.
According to the Stanford AI Index Report, an annual report issued each April, Israel had $1.52 billion in private-sector AI investments in 2023, surpassing 24 of the 27 EU countries, the exceptions being Germany, Sweden, and France. For the period 2013-23, Israel generated $12.83 billion worth of private sector investment in AI, more than any other EU country and considerably ahead of Germany, the EU leader, at $10.35 billion.
This acquisition is a source of national pride and inspiration in Israel, as it should be. It demonstrates that Israel and the United States can have a strong, mutually beneficial relationship both commercially and militarily.
These points, and the broader benefits to U.S. AI innovation, should be taken to heart by U.S. regulators and resoundingly emphasized by the Trump Administration to EU officials.
