SaaS-wide bundling trend continues, as Zscaler acquires Red Canary for AI threat detection

Zscaler is acquiring Managed Detection and Response firm Red Canary. The deal aims to combine Zscaler's extensive cloud data with Red Canary's threat hunting capabilities to advance AI-driven security operations.

Data meets expertise: The acquisition will merge Zscaler's platform, which handles 500 billion daily transactions for nearly half of the Fortune 500, with Red Canary's decade of experience in quick threat investigation, claiming over 99% accuracy and a tenfold speed increase. Zscaler CEO Jay Chaudhry said the move is a "natural expansion" to accelerate their "vision of AI-powered SOC of the future."

Flock gets firepower: Red Canary CEO Brian Beyer anticipates that access to Zscaler's massive data stream will "significantly enhance our ability to detect threats faster and more accurately." Red Canary plans to maintain its 200+ existing product integrations and states its partner ecosystem remains vital for a "more seamless experience" for customers of both companies.

Analyst angles: This acquisition fits into a broader cybersecurity trend of "platformization," Forrester analysts note, as vendors consolidate offerings. However, the same analysts question if bundling Security Service Edge (SSE) with MDR is a "natural or compelling consumption model" and point to potential cultural clashes between Zscaler's sales focus and Red Canary's practitioner-oriented culture.

Reading Recap:

• Zscaler details AI-powered SOC vision

• Red Canary on joining Zscaler

• Forrester's take on the acquisition

• Zscaler's recent AI-fueled earnings

The bottom line: With the deal expected to close in August 2025, Zscaler is betting that integrating Red Canary's specialized MDR skills will sharpen its AI security offerings, particularly as AI's role in business security expands, despite potential integration and cultural hurdles.