Microsoft has confirmed that it is acquiring Yammer, which will be joining Microsoft Office Division as soon as the $1.2 billion deal is closed. Yammer will continue to work separately from Microsoft to be able to deliver the same quality experience that its users love.
In a recent press release, Microsoft CEO Steve Ballmer said that by acquiring Yammer, a leading provider of enterprise social network, Microsoft will be attempting to deliver a technology that businesses seek today. He said, “Yammer adds a best-in-class enterprise social networking service to Microsoft’s growing portfolio of complementary cloud services.”
Yammer was launched in 2008 and soon gained immense popularity among businesses and currently enjoys as much as 5 million corporate users, 85 percent of which belong to Fortune 500 and the rest from nearly 200,000 companies around the globe. The site that works much like Facebook allows its users to stay updated on what their colleagues are discussing or the projects they are working on. On the site, users can communicate privately to their colleagues and companies can begin a grassroots movement and turn it into companywide strategic initiative.
Steve Ballmer is now counting on Yammer’s sharing tools to make sure that the long-established Microsoft applications, which were primarily designed for personal computers, remain a vital component of getting the work done and hence Yammer is going to be a fundamental part of the Microsoft Office Division.
The acquisition will not only accelerate Yammer’s adoption by more businesses, but will also give a boost to Microsoft’s complementary offerings such as SharePoint, Office 365, Microsoft Dynamics and Skype.
"We love the way Yammer built on a notion that things could grow virally," Ballmer said, referring to the fact that the site is free for people to use. "Consumerization of IT (technology at work) is a trend that, more than any other company out there, Yammer has gotten right."
Ballmer said that while the price for Yammer is higher than what he intended to spend on acquiring this technology, he’s confident that the site will begin to payoff as soon as employees start to collaborate on their jobs using Yammer. When asked as to how the Yammer integration will look like, Microsoft confirmed that the social network will continue to work as a “standalone service.”
While the acquisition might appear to be a great strategic move, technology analysts think that Microsoft is “too late to the social party.” Trip Chowdhry of Global Equities Research says there is no third slot left for Microsoft to fill in. "A company cannot get into leadership position by imitating the leaders, which in this case are Salesforce.com and Oracle," said Chowdhry.