Last year it was Skype for $8.5 billion. This year its the enterprise social networking site Yammer for $1.2 billion. Microsoft’s checkbook certainly isn’t sat around gathering dust.
Skype was an understandable purchase. It is extremely popular, with around 700 million registered users worldwide. At any given time there are almost 30 million simultaneous online users of Skype, a truly remarkable figure. What’s more Skype was already a household name when Microsoft made the acquisition.
Yammer is a different kettle of fish. Far from a household name, I’m sure that I wasn’t the only person who had to drop Yammer into Google to find out what it actually is. It is essentially a social networking platform designed specifically for businesses. Companies including Ford, eBay, Shell, DHL and Vodafone use it for internal communication and other social offerings. It is reportedly used by 200,000 businesses, which equates to roughly 5 million users. Despite these relatively low figures there is a huge amount of potential in Yammer, which is no doubt the reason behind the purchase.
Firstly the people behind it know what they are doing. The founder, David Sacks, launched Yammer in 2008 following his time as chief operating officer of PayPal and founder of popular genealogy site Geni.com which has over 50million users, so you could say he knows a bit about the internet.
Secondly, it ties in perfectly with the acquisition of Skype. Skype is used by millions of businesses, small and large, and it goes hand in hand with Yammer perfectly.
Thirdly, it fits in with Microsoft’s existing business offering and can be easily incorporated. Microsoft already dominated the business software sector and Yammer is an excellent bridge between business and social media, something that Microsoft has fallen badly behind on. In fact, Microsoft has already stated that they intend on integrating Yammer with Office and Skype.
It will be interesting to see where Microsoft takes Yammer. For the time being it will remain as a stand-alone service.