Microsoft Acquires Yammer For $1.2 Billion



Microsoft Acquires Yammer For $1.2 Billion

Microsoft Corporation (NASDAQ:MSFT) has reached a deal with Yammer to acquire the company for $1.2 billion. Yammer is an enterprise social network that boasts over 5 million users. 85 percent of the Fortune 500 companies use the service as part of more than 80,000 firms worldwide involved in the service.

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Yammer will become part of the Microsoft Office Division, and will remain under the control of the firm’s current CEO Kurt Sacks. The service could make an ideal addition to Microsoft’s current cloud services and its integration could push enterprise adaption of Microsoft’s Windows 8 tablet over the Apple Inc. (NASDAQ:AAPL) iPad.

The acquisition shows belies a continued reliance and affinity between Microsoft and enterprise customers. Enterprise use accounts for a large swath of Microsoft’s revenue from royalties on its Office suite and its Windows operating system. As the company attempts to adjust to the new drivers in technology.

Yammer may provide an ideal platform for Microsoft to create an ecosystem designed entirely for enterprise users. Yammer as a social network provides users with a closed and secure platform for discussing information relating to the company they are working in. It allows the growth of ideas in a way Facebook simply cannot provide.

By implementing integration of that social network in a complete way into its new phone, tablet, and desktop operating systems, Microsoft could push for quicker adoption of its new products. If the adoption is quick in the enterprise sector the firm might expect a knock on effect among consumers as the product becomes more familiar.

Ecosystems are everything in the tech world since Apple began to offer its iPhone in 2007. Cloud storage is the new key to integration of stems, but social networks may provide a more compelling way to shoehorn users into a particular product world.

Yammer was founded in 2008, and remains free for users on the entry package. Users wishing to avail of more features pay for a premium membership on the site. The service will be developed alongside Microsoft’s other cloud offerings.

Microsoft remains far behind players like Apple and Google Inc (NASDAQ:GOOG) in the smart phone and tablet market though the firm is now trying to change that. The acquisition of Yammer may well be a positive step on that path.The firm has always relied on it relationship with enterprise users for its main business base. Yammer gives them another avenue of tigh knit access to that base.