Author: Kenrick Tsai
SAN FRANCISCO, Dec 19 (Reuters) – Alphabet’s cloud computing unit and cybersecurity firm Palo Alto Networks (PANW) announced an expanded partnership on Friday, in what a source told Reuters was Google Cloud’s largest security services deal to date.
The contract includes Palo Alto’s commitment to pay Google Cloud “close to $10 billion” over several years, according to a person with direct knowledge of the matter.
Executives from both companies declined to comment on the specific figures of the contracts. Part of the spending will be used to migrate existing Palo Alto products to the Google platform, but a significant portion will be used to add new services involving artificial intelligence, Palo Alto President BJ Jenkins told Reuters.
Matt Renner, chief revenue officer of Google Cloud, said: “Artificial intelligence has created a huge demand for security.”
But while artificial intelligence is fundamentally changing some business functions, such as software development, cybersecurity is still in its infancy.
“It’s the same as when the cloud started to emerge, with new security threats emerging that no one had imagined,” Jenkins said.
Cyberattacks are increasingly carried out by the same generative AI tools that security providers use to bolster defenses.
Both Google and Palo Alto are investing heavily in security software as businesses look to adopt artificial intelligence.
Google’s $32 billion acquisition of security company Wiz is awaiting regulatory approval. Palo Alto launched an AI-powered product in October and last month announced plans to acquire software company Chronosphere for $3.35 billion.
Renner said the new deal is the latest demonstration of Google Cloud’s dominance as artificial intelligence reshapes the competitive landscape with hyperscale rivals Amazon and Microsoft.
The two companies have been strategic partners since 2018. Palo Alto CEO Nikesh Arora is a long-time Google executive who served as its chief commercial officer until 2014.
(Reporting by Kenrick Cai in San Francisco; Editing by Stephen Coates)
