Palo Alto, CrowdStrike, Zscaler 'Will Only Get Bigger' Says Expert: Cybersecurity Market Projected To Hit $2 Trillion By 2030

Author: Surbhi Jain | July 19, 2024 02:31pm

The drive for consolidation is evident: with cybersecurity threats becoming more frequent and severe, companies and governments are compelled to bolster their defenses.

As large IT firms and private equity investors snap up cybersecurity specialists, the industry is poised for significant growth and transformation. Google’s acquisition of Wiz is a major step in this direction, heralding a future where cybersecurity giants dominate the field, offering more robust and integrated protection solutions.

Google’s Wiz Acquisition Could Trigger A Consolidation Wave

Google parent Alphabet Inc‘s (NASDAQ:GOOGL) (NASDAQ:GOOG) $23 billion acquisition of Wiz is shaking up the cybersecurity landscape, marking the start of a major consolidation wave.

Wiz CEO Assaf Rappaport, speaking at the Fortune Brainstorm Tech conference, emphasized the necessity of this move. "First and foremost, I think consolidation in the security market is truly a necessity," Rappaport said. He pointed out the market’s fragmented nature and predicted that M&A activity is just beginning to ramp up.

Sony, MGM Continue To Drive Investment In Cybersecurity

The latest data from Corporate Finance Associates (CFA) supports this trend. The CFA’s Q2 2024 report on IT Services M&A activity highlights the explosive growth in demand for cybersecurity solutions.

John Holland, CFA’s managing director, noted, “Capital always finds growth opportunities. Cybersecurity solutions providers offer enormous growth potential to investors.” He recalled the infamous Sony hack, which was a wake-up call to both corporate entities and governments, and referenced ongoing incidents like the recent MGM hack that continue to drive investment in cybersecurity.

Read Also: Biden Administration To Ban Sale Of Russia-Linked Kaspersky Software In US Over National Security Concerns: Report

‘The Big Five Will Only Get Bigger’ Says Link

Stephanie Link, chief investment strategist at Hightower Advisors, sees Google’s move as just the beginning. "Google's decision on Wiz is just the tip of the iceberg in massive M&A. The big five will only get bigger," she said, referring to major players like Palo Alto Networks Inc (NASDAQ:PANW), CrowdStrike Holdings Inc (NASDAQ:CRWD), ZScaler Inc (NASDAQ:ZS), Cloudflare Inc (NYSE:NET), and Fortinet Inc (NASDAQ:FTNT).

Read Also: CrowdStrike Shares Trim Heavy Losses As Microsoft Announces Resolution Of Global Tech Outage: ‘This Is Clearly A Major Black Eye’

Link also highlighted the market’s potential, projecting a total addressable market of over $2 trillion by 2030. “CTOs are focusing their spending on AI and Cyber because they have no choice but to secure their business,” she added, noting a shift away from multiple vendors to more integrated solutions.

This consolidation wave reflects a broader trend of strategic M&As aimed at strengthening cybersecurity defenses. As companies and governments face increasingly sophisticated cyber threats, the industry is evolving towards fewer, more powerful players capable of providing comprehensive security solutions.

Google’s acquisition of Wiz is a clear indicator of this transformation, promising enhanced capabilities and streamlined services to meet the escalating demands of the digital age.

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• Google’s ‘Poker Move’ With Wiz Could Be The Kickoff For Big Tech M&A In 2025: Analyst

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