June 14, 2012

Microsoft Buying Yammer? Bring It!

The blogosphere is atwitter – and, the twittersphere is agog – with the leaked insight that Microsoft is in serious discussion with Yammer over an acquisition.  (See PC Magazine or Pando Daily or Bloomberg). The estimated pricetag for such a grubstake? At least a cool billion, which is not surprising when you consider that Yammer has raised north of $130 million, and VCs will be wanting their return.

Not that anyone has asked, but we are not unhappy by the prospect of such an acquisition, for at least a couple reasons.

1. Market Validation

A possible acquisition by Microsoft, at such an elevated cost, is an indication that Microsoft sees the social business market as critical to its success in the enterprise. Sure, there have been other such acquisitions in the past year or two – VMWare’s purchase of Socialcast, for example – but this stands apart as something significant.

The social business market is certainly maturing, and it continues to capture the attention of not just analysts and pundits, but increasingly businesses are recognizing the opportunity. Recent reports by IBM and MIT/Deloitte have both indicated a trend toward greater enterprise adoption and impact.

Just today, the Dachis Group, in an article entitled Social Maturity at Scale: From Evangelism to Execution, indicates that in their informal poll, E2.0 practitioners are faring well in their implementations. Though many are moving slower than expected, there were actually no reports of what could be termed failures of social media within the enterprise.

But if there were a graph that mapped the rise in acceptance of social business over time, though it would have been steadily climbing these past few years, the news of a Microsoft acquisition of Yammer would certainly represent a step function on that curve.

2. SharePoint Social Shortcomings Acknowledged?

Anyone involved in getting enterprises up to speed on social business has encountered the SharePoint challenge. It usually appears in the guise of an IT executive, who is pretty invested in the Microsoft stack, claiming that SharePoint is a perfectly viable social platform.

To social business savants, this is patently false. SharePoint is an enterprise document management system, a static repository to its very core, and hardly the dynamic and engaging social platform as Microsoft has positioned it. By adding a handful of social-like features, SharePoint can actually compete in a checkbox-driven competition – and Microsoft is a daunting competitor in such cases – but the fact is that it is merely window-dressing, a database-enabled development platform in social clothing.

Recently, there are whispers aplenty that SharePoint 2013 will be the ultimate platform for integrating social into enterprise Intranets and document management. And many of us have seen the FUD (Fear, Uncertainty and Doubt) conjured up by such a promise.

We should know better. The fact that SharePoint 2010 represented such an insignificant improvement in social functionality over SharePoint 2007 is an indication that there is just so far even the mighty Microsoft can contort their platform into being something it isn’t.

So, an acquisition of Yammer by Microsoft would be the ultimate, and long-awaited admission that no, SharePoint isn’t really a social platform and that SharePoint 2015, while it will surely by head-spinning, will not be Microsoft’s entry into the space.

Nimble Innovators

Are we concerned about a potential acquisition? Actually, not at all.

The emergent market, especially as it matures, needs the smaller, more nimble participants that can move faster, innovate more freely, and stay more responsive to the environment. We have a lot more innovating to do – as evidenced by our amazing release schedule these days, during which time we’ve been delivering new great new features every week.

It’s still early days in this competition. A Microsoft-Yammer alliance would clearly be a behemoth and a force to be reckoned with. But don’t bet against the smaller, nimbler and more creative teams to be setting the pace and setting the bar for innovation.

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