Microsoft confirms USD 1.2 billion Yammer buy
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