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Ballmer welcomes Yammer to the Microsoft family

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Analysis Microsoft has finally tied the knot with enterprise social networker Yammer, and in a press call following the announcement, Steve Ballmer laid out the future for Redmond's newest recruit.

"Yammer will be a fundamental part of the Office family," a "thrilled" Steve Ballmer said, adding that it would become a core addition of SharePoint and Lync services on the cloud. It brought a "very unique" set of skills, and Yammer will operate as a separate but equal section of Redmond's Office team.

Yammer's viral business model – spreading through a free social service for people in business and then upselling features into IT departments that want to run the platform – was a key part of the deal, Ballmer said. Microsoft hopes Yammer will be the goose that will continue to lay golden users; it's clear that Ballmer & Co. want Yammer to continue to add customers even if they aren't using Redmond's software.

In the short term, nothing's going to change that much for Yammer or its customers. The service will work as usual, Yammer employees will turn up for work at their San Francisco office tomorrow (although possibly with colossal hangovers), and both CEO David Sacks and CTO Adam Pisoni are sticking with the firm.

But looking ahead, Yammer's social networking acumen will be merged into Office 365, SharePoint, and Lync systems, said Kurt DelBene, president of Microsoft's Office Division. It'll be cloud-only, however, with developing Yammer for on-premises systems not a high priority, he indicated.

The pace of that integration is going to be key, however. No one from Yammer or Microsoft would commit to any timetable for rolling out combined services, and the paucity of progress Redmond has made in building Skype into its portfolio thus far isn't encouraging.

At $1.2bn Yammer came cheap in comparison to Skype, but Microsoft has been lacking in the social side of its software and has loose alliances with Facebook and LinkedIn. Last month it dipped a toe into the social shark pool with so.cl, which lets users share the usual smorgasbord of data with a big video-chat element, but that looks to be more of a consumer offering whereas Yammer is all about the enterprise.

When questioned on whether the recent social IPO phase, in particular Facebook's lackluster opening, had affected the price of Yammer, there was a polite silence before Ballmer filled in that discussion had been going on both before and after Zuckerberg's second biggest day. The star social-performer IPO thus far has been LinkedIn, with consumer services falling in value.

Sacks emphasized that his company and LinkedIn were very different, with the later posting its information online compared to Yammer's more private service, but the implication is clear: Microsoft has finally got on the enterprise social-networking train. Whether it's a speedy TGV line or Silicon Valley's plodding Caltrain depends on how well Redmond can merge Yammer, and if the current customer base will see any benefit or step off board. ®

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