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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COMMENTS
negative connotations
It sounds like it should be a company from 2005 selling crappy ringtones, with shitty late night TV ads. If you went out surveyed people "Have you heard of Yammer?" and gave them the option of a business social network or a ringtone merchant, its the one most would pick I am sure of it!
Paris because she's into yammering.
How could something like Yammer be worth $1.2-billion!?
I already mentioned my disbelief about the lunacy of this Microsoft acquisition in the comments section of an earlier Register article about this back when the possibility of Microsoft acquiring Yammer was still a rumor, but I am still shaking my head in disbelief about this whole thing and asking myself "WTF?" The reason why I am so taken back by this isn't the fact that Microsoft bought Yammer, but that Yammer had somehow become worth $1.2-billion.
As I mentioned in my comment to the previous article, at a company that I previously worked at one of my bosses was always enamored by whatever the latest trendy social networking service of the week was. Sometime in late 2008 or early 2009, mere months after the Yammer service was first launched at the TechCrunch50 conference, my boss heard about it and forced our entire department to use it. When I first saw the Yammer desktop application back then I thought that it was the most redundant piece of nonsense that I had ever seen. Why? Because at the time it was basically only a Twitter-like micro-blogging service, with the only difference being that it put the question "What are you working on?" in front of its input text-box. This really irked me because I didn't see why anybody thought this was so special or God forbid, actually innovative somehow. Everything from Twitter to web forums to Facebook walls have text boxes where you can type in what you are currently working on, amongst other things if you feel like it. There is nothing stopping you from doing that. You could have used at least a dozen different platforms that could have essentially replicated what Yammer did, even at the time. Heck, you could develop such a micro-blogging system internally in your organization with PHP and MySQL (or your particular language/DB combination of your choice) with a single programmer and a week's time if you wanted to. Yammer's sole "innovation" was that they put the question, "What are you working on?" in front of that input text box, and that suddenly made it an "enterprise collaboration application" that won awards. Really? It's so hard to type in what you are currently working on in a form's textbox without that question explicitly being written there?
Now to be fair, Yammer has increased the amount of features and abilities that it offers with its service since when I first used it right after it's launch in late 2008/ early 2009, but even so, how does a simple micro-blogging service like that ever become worth $1.2-billion? That's the same amount that Hewlett-Packard spent in 2010 to buy Palm, Inc. How is Yammer of all things worth as much as Palm, a company that made both software and real physical products, when it was acquired? In 2009, Rackable Systems was able to buy Silicon Graphics, Inc., a computer company that produced real physical products like workstations, servers, and supercomputers, for a mere $25-million. How in the heck is Yammer worth 48-times as much as Silicon Graphics, Inc., was? And Google was able to buy the company Android, Inc. and its mobile operating system "Android" in 2005 for only $50-million, and somehow Yammer is worth 24-times more than that! Has the world gone mad? How could something as simplistic as Yammer ever have become worth more than those other acquired companies? I think that I am developing a brain aneurysm just trying to wrap my head around this!
$1.2 Bn worth of meh.
Seriously how on earth does MS value companies?
Whoever does it should be fired and sued for the cost of all their recent acquisitions.
New start up strategy - come up with something pointlessly web 2.0 that Balmer will want after his daily chair smashing session.
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