Microsoft's earlier acquisitions of similar companies like Lync and Yammer show LinkedIn integration will hold key to successful outcome
Microsoft Corp., which agreed to buy LinkedIn Corp for $26.2 billion in cash on Monday, is clearly strengthening its real-time cloud-based unified communications (UC) suite for enterprises with the purchase of the professional networking site even though its earlier acquisitions of similar companies like Lync, Yammer and Skype indicate that integration will hold the key to a successful outcome.
UC tools from companies like Cisco Inc, Avaya Inc, Google Inc, Facebook Inc and Microsoft offer integrated data, video, and voice, allowing users to access a variety of communication applications such as e-mail, SMS, video, fax, voice, and others through a single user mailbox. UC also allows for scheduling, workflow, instant messaging and voice response systems, and provides the integration through multiple devices, be it your desktop, laptop, cellphone or even a wearable.
The unified communications bit, thus, fits well with the overall vision that Satya Nadella, chief executive officer of Microsoft Corp, has—that of wanting Microsoft to help companies reinvent their productivity and business processes with the help of tools like OneNote, Windows 10 and Office 365; build an intelligent cloud with the help of Azure; and introduce new types of computers such as the Surface Pro tablet, wearables such as Microsoft Band and mixed reality gadgets such as HoloLens even as Microsoft is keen on having Windows running on any device.
Given this context, the intended purchase of LinkedIn, with over 400 million users worldwide of which over 30 million are from India, appears to be a wise decision given its database of sticky professionals and LinkedIn users’ synergy with enterprise tools like SharePoint, Skype for businesses, Office 365 and Dynamics. Moreover, LinkedIn’s news feed can compete with that of Facebook.
Besides, Microsoft can also offer unified communications as a service to small and medium-sized companies, given that many LinkedIn professionals run their own companies.
Microsoft’s earlier buys, however, have not always been smooth.
Just four years back, for instance, Microsoft bought a private social network Yammer, which helps employees collaborate across departments, locations, and business apps, for $1.2 billion but, on the face of it, the Redmond company does not appear to have taken much advantage of the enterprise collaboration platform. Critics have been pointing out to the lack of an update user interface (UI).
Yammer, along with Office 365 Groups, is part of a wider Microsoft strategy to turn Office 365 into a personalized portal for employees but it is yet to substantially improve the user interface or add significant features and functionalities. Microsoft has said that it plans to accelerate Yammer’s adoption alongside complementary offerings from Microsoft SharePoint, Office 365, Microsoft Dynamics and Skype.
It was on 26 April that the Yammer team finally put out a blog that its new external groups feature in Yammer enables users to include people outside your company in a Yammer group—making it easier for extended teams to work together. The external groups capability builds on the existing ways to work with people outside your company, such as external networks and external messaging, which enables you to add people outside your organization directly to a thread in your organization’s Yammer network.
Also consider the purchase of voice over internet protocol (VoIP) company, Skype, by Microsoft in May 2011 for $8.5 billion. One may recall that even at that time, Microsoft’s own software had a considerable overlap with Skype. Windows Live Messenger offered free instant messaging, and voice- and video-chat. And its enterprise system, Lync 2010 (earlier known as Office Communication Server) allowed companies to create private networks that combine the communications capabilities of Live Messenger with corporate manageability. Live Messenger and Lync were interoperable.
Not surprisingly, then, Microsoft said in April 2014 that it would rebrand the Lync corporate communications platform as “Skype for Business" —just a little over three years after acquiring Skype. The name change became official in 2015.
Microsoft’s competitors have their own UC suites. Google has Gmail and its users can watch videos on YouTube, create meetings with Google Calendar, own an Android smartphone, and chat with friends using Hangouts. Besides, it has Google Apps for Work, a competitor to Office 365.
Last January, Facebook—the world’s largest social network—made its first move into the enterprise with its ‘Facebook at Work’, an enterprise-level social and collaborative network for the workplace. India’s Yes Bank Ltd already uses ‘Facebook at Work’ for its 15,000-plus employees, the first banking organization in India to adopt the enterprise version of the social networking platform in India.
Nadella is gradually phasing out some of the legacy decisions he inherited from former chief executive officer Steve Ballmer, one, of course, being Nokia’s phone business and the other was the bashing of Linux and everything that was open source (http://bit.ly/1OWMAvQ). Microsoft’s Windows 10, or “Windows as a service", now provides free upgrades.
All these moves, including the purchase of LinkedIn announced on Monday, reinforce Microsoft’s bid to retain its edge, and stay relevant in a world where consumers are increasingly doing more personal and official work on mobile devices, such as smartphones, tablets and phablets, which run on free operating systems like Google Inc.’s Android and Apple Inc.’s iOS, rather than on desktops and laptops, most of which run on Microsoft’s Windows OS. Today, Microsoft’s office suite already runs on rival Apple’s iOS and Google’s Android OS devices.