LONDON, July 19 (Reuters) - American cybersecurity

company CrowdStrike ( CRWD ) became a household name for all the wrong

reasons on Friday, after a botched update caused havoc around

the world.

The company's stock fell more than 14% after an outage

disrupted operations across multiple industries - shutting down

public services, halting flights, and forcing some broadcasters

off the air.

CrowdStrike ( CRWD ) - which has previously reached a market cap of

about $83 billion - is among the most popular cybersecurity

providers in the world, with close to 30,000 subscribers

globally. The firm has been a software darling for investors,

due to its growth and high margin. Its stock had doubled in the

past year before Friday's slump.

But the outage could force customers and investors alike to

rethink their dependence on the company, opening the door to

potential rivals like Palo Alto Networks ( PANW ), which saw its

stock rise 1.7% on Friday, and Sentinel One, which jumped as

much as 3.6%.

"This event is a reminder of how complex and intertwined our

global computing systems are and how vulnerable they are to a

mistake and an error," said Gil Luria, senior software analyst

at D.A. Davidson.

"While most companies don't really have an alternative to

Microsoft ( MSFT ), they do have alternatives for security," he added.

"This may cause many companies to reconsider which security

product they use, and whether they need to diversify across

different security products in order to prevent these types of

outages."

OUTAGES HAPPEN

However, other analysts said that while Friday's events had

been damaging for CrowdStrike ( CRWD ), they did not foresee competitors

taking much market share as a result of the incident.

"This is clearly a major black eye for CrowdStrike ( CRWD ) and the

stock will be under pressure," said Dan Ives, analyst at Wedbush

Securities, but he noted that the incident stemmed from a

technical update and not a hack or cybersecurity threat, which

he said would be "more worrying".

Analysts at JPMorgan said customers would initially be

upset, but that the company had taken ownership of the issue.

CrowdStrike ( CRWD ) CEO George Kurtz said in a post on social media

platform X that the event was not a security incident or

cyberattack and a fix had been deployed. He later apologised for

the impact caused by the company.

"Outages happen, and the scale here is meaningful, but we

think diligent handholding and efficient response from

CrowdStrike ( CRWD ) will be helpful," the JPMorgan analysts said.

Governments and public services in countries such as New

Zealand, Australia, and various U.S. states were also hit by the

outage. This could lead to lawmakers pushing through legislation

to protect against a similar glitch in the future.

"There is likely going to be an investigation by governments

about how this happened, and what they can do in terms of

regulation to prevent it from happening again," said D.A.

Davidson's Luria.