Then there’s the matter of how the takeover could affect corporations trying to stay safe amid growing concern about rising cyberthreats due to Russia's war in Ukraine, which our colleague Martin Giles examined in his own story this week. Current geopolitical tensions might have made Mandiant a particularly attractive target, Martin writes, because the company “has built up a reputation for smart analysis of hackers’ activities, including those of groups from Russia and China."
(If you’re interested in how companies are responding to these kinds of threats, you might also enjoy Martin’s CIO newsletter. Another colleague, Thomas Brewster, has also been covering the cyber angle of the war in Ukraine, including in his own weekly newsletter on the wider world of cybersecurity, internet privacy and surveillance.)
That covers what makes the deal interesting for the broader M&A market and for cybersecurity. What about the perspective of Google’s acquisition history?
Again, it’s quite rare to see Google shell out this much. It’s the company’s second-largest acquisition ever, trailing only the $12.5 billion takeover of Motorola Mobility. That was a short-lived relationship: In 2014, Google flipped much of the Motorola Mobility business to Lenovo for $2.9 billion, although it held on to some very valuable patents related to Google’s Android ecosystem.
Speaking of Android—let’s close out today’s introduction with a quick timeline of Google’s biggest and most meaningful acquisitions:
2005: One year after it went public, Google acquired an upstart operating system known as Android for a scant $50 million. Before long, Android had become the basis for a smartphone empire, with more than three billion users as of last year. By 2010, executive David Lawee was already calling the purchase Google’s “best deal ever."
2006: One year after pouncing on Android, Google conducted another takeover that, in retrospect, looks like an enormous bargain. It paid $1.65 billion for YouTube, then a fledgling platform for sharing videos. Last year, YouTube generated nearly $29 billion in advertising revenue, and some analysts believe it would be worth hundreds of billions as a standalone company.
2008: DoubleClick was a powerhouse in the early days of targeted online advertising. It survived the dotcom bubble, and in 2005, it was the subject of a $1.1 billion take-private buyout by Hellman & Friedman and JMI Equity. Google came calling a few years later, purchasing DoubleClick from the two firms for $3.1 billion. It’s no longer a standalone business, having been absorbed into the larger Google Marketing Platform, a complement to Google’s core $210 billion ads business.
2013: For its next billion-dollar deal, Google bought Waze for a reported $1.1 billion. The purchase drew initial antitrust attention, as Waze’s smartphone navigation software was one of the biggest independent competitors to Google Maps. But the Federal Trade Commission opted not to mount a formal challenge, and the deal went through.
2014: At the time of its acquisition in a $3.2 billion deal, Nest Labs was best known for its smart thermostats. Now, it serves as the umbrella brand for Google’s entire smart-home business. You might be noticing a trend: Most of Google’s biggest acquisitions have involved consumer-facing targets.
2020: Look here, an exception. Looker is a software company that specializes in business intelligence and analytics, helping companies parse and interpret broad swathes of data. Google purchased Looker for $2.6 billion, marking an exit for venture backers such as Redpoint Ventures and First Round Capital.
2021: Google first agreed to buy Fitbit for $2.1 billion in November 2019, a bet on the rising tide of wearables. But the deal didn’t get done until January 2021 thanks to regulatory concerns—including the worry that Google might deploy Fitbit’s huge database of personal health data to sell ads. Google pledged it would do no such thing, though, and Fitbit said that user privacy concerns were “paramount” when it was hunting for a buyer. —K.D.
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