Mi­crosoft con­firms USD 1.2 bil­lion Yam­mer buy

InformationWeek - - News - — Source: The Brain­yard

Ru­mored for more than a week, Mi­crosoft’s plan to ac­quire Yam­mer be­came of­fi­cial on June 25.

Early busi­ness news re­ports turned out to have just about ev­ery­thing right, down to the USD 1.2 bil­lion price. Mi­crosoft did con­firm that Yam­mer will be in­te­grated into the Mi­crosoft Of­fice di­vi­sion, mak­ing it part of the same prod­uct fam­ily as Share­Point, which was one de­tail that hadn’t been clear pre­vi­ously. Some an­a­lysts thought it would be more likely to be po­si­tioned as an ad­junct to Mi­crosoft Dy­nam­ics CRM, as a counter to Sales­force.com’s Chat­ter ser­vice, which is sim­i­lar to Yam­mer. In­stead, Yam­mer is to be in­te­grated with Share­Point, Dy­nam­ics, and other prod­ucts but will also have a life of its own.

Kurt DelBene, Pres­i­dent of the Mi­crosoft Of­fice Di­vi­sion, praised Yam­mer as “best in class en­ter­prise so­cial net­work­ing” and the com­pany be­hind it as pro­vid­ing “rapid in­no­va­tion in the cloud that will ben­e­fit Mi­crosoft cus­tomers.“

Yam­mer op­er­ates on a freemium busi­ness model where in­di­vid­u­als can sign up to start col­lab­o­rat­ing with oth­ers in the same busi­ness do­main. Or­ga­ni­za­tions that find the col­lab­o­ra­tion use­ful can con­vert to paid ac­count with ad­min­is­tra­tive fea­tures and other up­grades.

Mi­crosoft CEO Steve Ballmer said Yam­mer’s sales model was one of the things he found most at­trac­tive. Yam­mer is “re­ally unique, maybe very unique in the vi­ral adop­tion model. You can throw the words ‘en­ter­prise’ and ‘so­cial’ on a bunch of dif­fer­ent stuff, but you can’t find any­body [else] that has re­ally built a cus­tomer base of en­ter­prise IT cus­tomers, vi­rally — with great re­spect from the IT de­part­ment and with great love from the cus­tomers. I think Yam­mer is very unique in that.”

Mi­crosoft stressed that Yam­mer would con­tinue to op­er­ate as a stand­alone ser­vice, even as the com­pany looks for ways to deepen its in­te­gra­tion with Share­Point and other Mi­crosoft prod­ucts.

DelBene did not pro­vide de­tails about how Yam­mer would mesh with Mi­crosoft’s ef­forts to boost the so­cial soft­ware ca­pa­bil­i­ties built into Share­Point, say­ing it was too early. “We’re very ex­cited about the so­cial feeds and ca­pa­bil­i­ties of Yam­mer and very com­mit­ted to con­tin­u­ing it as a stand­alone busi­ness,” DelBene said. At the same time, Mi­crosoft will ob­vi­ously be look­ing for syn­er­gies, par­tic­u­larly with Of­fice365, he said. Yam­mer will be less rel­e­vant to the strictly on premises en­vi­ron­ment of Share­Point, he said.

“Share­Point is a tremen­dous suc­cess and has a bright fu­ture, and Yam­mer is a tremen­dous suc­cess and has a bright fu­ture,” Ballmer said. “One of the keys, of course, is re­ally get­ting the in­te­gra­tion right.”

When asked whether the model for in­te­gra­tion might fol­low that of Skype, which has been al­lowed a de­gree of au­ton­omy af­ter its ac­qui­si­tion, Ballmer said, “sure” but did not elab­o­rate.

Steve Ballmer, CEO , Mi­crosoft

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