5 Big Cloud Security Deals Shaping the Industry in 2023
The cloud industry’s pandemic-fueled boom is leading to consolidation in the cloud security market as bigger firms look to bolster their own offerings.
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On Sept. 19, cybersecurity powerhouse CrowdStrike announced its plan to acquire Bionic, a provider of Application Security Posture Management (ASPM), in a deal widely reported to be valued at $350 million.
The announcement came on the heels of CrowdStrike’s most recent financial results that showed the company’s public cloud deployments grew to $296 million, up 70% year-over-year.
“The cloud is cybersecurity’s new battleground, yet the indsutry’s answer to-date has been disjointed point security tools or ‘platforms’ with multiple consoles and agents,” George Kurtz, co-founder and CEO at CrowdStrike, said in a statement. “…the addition of Bionic further extends our cloud security leadership on our mission of stopping breaches.”
CrowdStrike will offer Bionic ASPM as an independent service and as a fully integrated capability of Falcon Cloud Security, part of CrowdStrike’s AI-powered platform.
The all-cash purchase is expected to close during CrowdStrike’s fiscal third quarter.
Cybersecurity solutions provider Check Point Software Technologies earlier this month announced the completion of its acquisition of Perimeter 81, a Security Service Edge (SSE) company with more than 200 employees and 3,000 customers worldwide. Check Point said the deal would reinforce its dedication to ensuring fast and secure access for remote users, sites, datacenters, and the internet.
“Welcoming Perimeter 81 into the Check Point family fortifies our position in the SASE market,” Gil Shwed, CEO at Check Point, said in a statement. "Their unique suite, which offers Zero Trust Access, full mesh connectivity and swift one hour deployment, aligns perfectly with our vision of delivering the industry’s fastest, most secure SASE solution.”
In May, IBM announced the acquisition of cloud security firm Polar Security in a deal worth $60 million, making it one of more than 30 companies bought since IBM CEO Arvind Krishna took the helm in 2020.
“The pandemic drove a sharp increase in cloud adoption, leaving organizations to grapple with a deluge of cloud data that led to more silos and ‘shadow data’ -- sensitive data not being tracked or managed.”
Founded in 2021, Polar Security offers data security posture management (DSPM), an emerging cybersecurity segment revealing where sensitive data is stored, who has access to it, how it’s used and is able to identify vulnerabilities.
IBM plans to integrate Polar Security’s DSPM technology within its Guardium family of security products, the company said.
Mastercard in March announced that it had acquired cloud-based cybersecurity company Baffin Bay Networks, a Sweden-based firm specializing in AI solutions.
“We see trust as central to securing the future of our digital world,” said Ajay Bhalla, president of Cyber and Intelligence at Mastercard, in a statement. “The addition of Baffin Bay Network’s instantaneous, predictive, and cloud-based AI technology to our existing analytical capabilities will deliver a leading, singular cyber solution. This will enable us to provide our customers across the world with faster, smarter, and more effective protection from cyber risk.”
Last week, Cisco announced the acquisition of software company Splunk for $28 billion as the company looks to add to its security software and cloud business. Cisco’s other cloud security purchases this year included firms Valtix and Lightspin.
“From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient,” Cisco’s chair and CEO Chuck Robbins said in a statement.
Gregg Siegfried, VP analyst with research firm Gartner, told InformationWeek that the deal was a win-win for the companies. “They can certainly both benefit,” he said. “Cisco has suffered with software business and Splunk has the expertise delivering software.”
Patrick Moorhead, CEO and chief analyst at Moor Insights & Strategy, says observability was a key factor in forging the deal. “This acquisition makes sense on many vectors,” he tells InformationWeek. “This enhances Cisco’s observability and security capabilities leading to improved enterprise capabilities. Enterprises want less vendors to integrate with and manage, and this combination does that. Enterprises have too many enterprise and data vendors and want simplicity.”
Last week, Cisco announced the acquisition of software company Splunk for $28 billion as the company looks to add to its security software and cloud business. Cisco’s other cloud security purchases this year included firms Valtix and Lightspin.
“From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient,” Cisco’s chair and CEO Chuck Robbins said in a statement.
Gregg Siegfried, VP analyst with research firm Gartner, told InformationWeek that the deal was a win-win for the companies. “They can certainly both benefit,” he said. “Cisco has suffered with software business and Splunk has the expertise delivering software.”
Patrick Moorhead, CEO and chief analyst at Moor Insights & Strategy, says observability was a key factor in forging the deal. “This acquisition makes sense on many vectors,” he tells InformationWeek. “This enhances Cisco’s observability and security capabilities leading to improved enterprise capabilities. Enterprises want less vendors to integrate with and manage, and this combination does that. Enterprises have too many enterprise and data vendors and want simplicity.”
After the pandemic slowed the global supply chain to a crawl, many organizations began moving to more cloud-based services. IT leaders were faced with the challenge of getting new systems up and running, and, maybe more importantly, securing their cloud services.
The cloud security market is booming. The global cloud security market size stood at $29.26 billion in 2021 and is expected to reach an eye-popping $106.02 billion by 2029 -- an annualized growth rate of 18.1%, according to research from Fortune Business Insights. A 2023 Thales Group cloud security study found that 39% of business experienced a cloud-based breach in 2022. And 89% of survey respondents said 40% of the data stored by their companies is considered sensitive.
So as the volume of cloud-based sensitive data grows, it only makes sense that efforts are increasing to shore up security solutions. “Cloud has been elevated from a technology disrupter to a business disrupter,” Sid Nag, VP Analyst at Gartner said in a statement. “Generative AI will continue to drive the cloud market forward.”
In the following slides, InformationWeek takes a look at five big merger and acquisition deals that show how cloud growth and security needs are shaping a booming industry.
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