It brought airlines, media houses and banks (among others) to their knees in diverse markets, including India. So crucial is cybersecurity now in the tech world that Google’s parent Alphabet wants to acquire Wiz, a cybersecurity startup, as New York Times reported, even if that exposes it to antitrust scrutiny from regulators worldwide.

To businesses, acquisitions are vital for growth and innovation. However, Google’s dominance in various sectors puts it on the anti-monopoly radar.

If the acquisition goes through, it will be Google’s biggest ever. It aims to acquire Wiz for about $26 billion. (nyti.ms/3LwtPFw). Google wanting to lead in cybersecurity is no surprise; this move would shore up its cloud offerings. Its Google Cloud division, run by my school classmate Thomas Kurian, lags Amazon’s and also Microsoft’s.

In the US, the Federal Trade Commission and Department of Justice are the primary enforcers of these anti-monopoly laws. The European Commission plays a similar role in the EU. These bodies scrutinize mergers and acquisitions to ensure they do not harm consumers by stifling competition, raising prices or reducing innovation.

Google is no stranger to these regulators. With dominant positions in search, online advertising and mobile operating systems, it is under close watch. Recent high-profile antitrust cases, such as EC fines imposed on Google for anti-competitive practices in its Android and search operations, underscore the vigilance of regulators.

Despite scrutiny, Google has successfully executed several significant acquisitions. The key lies in combining strategic planning with regulatory compliance, and leveraging its resources to present a compelling case for the benefits of its buy-outs.

It publicly shares its vision for acquisitions, emphasizing their positive impact on innovation and user experience. This clever marketing couched as transparency helps generate trust and mitigate any public or regulatory backlash.

A significant aspect of its strategy involves leveraging data and artificial intelligence (AI) to enhance its products and services by acquiring companies with valuable data-sets and AI capabilities. For example, the acquisition of DeepMind in 2015 bolstered Google’s AI research, leading to rapid advancements.

Such acquisitions raise antitrust concerns, particularly around data privacy and market dominance. To address them, Google claims to maintain strict data separation between its existing services and acquired entities.

Google often targets companies that can complement its operations and spur innovation. For instance, it snapped up YouTube in 2006 and Android in 2005, when they were viewed as high-potential platforms. YouTube has since become the world’s dominant video platform (and second largest search engine), while Android powers most of the world’s smartphones.

These purchases were justified to regulators on the grounds that they would enhance consumer choice and drive innovation. Its acquisitions also often capitalize on broader market trends and competitive dynamics. By acquiring Nest in 2014, it tapped the world’s burgeoning smart-home market, helping it compete with Amazon in this space.

Google meticulously prepares regulatory filings whenever it pursues a target. It also engages proactively with regulators, often long before a deal is publicly announced. In some cases, the firm agrees to concessions to gain approval. When it acquired Fitbit in 2021, it promised not to use its health data for advertising.

This commitment was crucial in assuaging regulator concerns about data privacy and market dominance. It also agreed to maintain open access to Fitbit’s application programming interface for third-party developers to allow for competition.

Google’s approach to Wiz is no exception. Cybersecurity is a burning issue in cloud computing. Almost 85% of the world’s largest organizations report at least one major breach a year, and over 50% report more than two. Google Cloud, with a formidable cybersecurity solution, could emerge as a leader. Microsoft’s outage didn’t help its cause as a competitor.

Google’s approach to acquisitions varies by region. The EU has stringent antitrust rules, while the US’s laissez-faire disposition may change as calls grow for tighter norms. Its DoubleClick buy-out in 2008 faced scrutiny in both the US and the EU. The deal was eventually approved, but Google has to assure regulators that it won’t hurt the online advertising market.

As Google grows even larger, it must tread carefully. However, its track record shows a sophisticated understanding of the regulatory landscape and a proactive approach to addressing monopoly concerns.

Google’s ability to make big acquisitions despite intense antitrust scrutiny is a testament to its strategic acumen. By focusing on innovation, engaging proactively with regulators and maintaining transparency on its deals, Google navigates a complex landscape to keep evolving.

As the regulatory environment tightens, Google’s approach will undoubtedly evolve, but its core strategies of compliance and innovation will remain central to its success.