Big Tech Invests Big in Cybersecurity

On March 8, Google announced its intent to scoop up cybersecurity corporation Mandiant for $5.4 billion. This deal would mark the biggest acquisition by Big Tech in the cybersecurity sector in recent years. While GAFAM has long since identified this segment as worth investing in, it significantly ramped up its financial contributions to the sector over the last year as our chart shows.

In 2021, Alphabet, Amazon, Meta, Apple and Microsoft spent a combined $2.4 billion on funding or acquiring 23 cybersecurity companies, an increase of roughly $1.8 billion or 336 percent according to data aggregated by CB Insights. Outright acquisitions in this space are rare, though. Since 2016, only 17 companies were bought up by GAFAM corporations, with Microsoft and Amazon leading the race with eight and four buyouts, respectively.

In terms of technology, securing the cloud and an ever-expanding Internet of Things have become the top priorities over the last months. This is exacerbated by an increase of companies adopting a remote or hybrid work model, which allows for greater freedom and flexibility, but also puts strains on cybersecurity infrastructure due to an increase in attack points for hackers. In 2021 alone, the cost of cyber crime allegedly exceeded $6 trillion and is expected to amount to more than $10 trillion by 2025 according to Cybercrime Magazine.