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Microsoft Businesses Software The Almighty Buck Technology

Microsoft Buys Yammer For $1.2 Billion 72

Posted by timothy
from the pretty-soon-you're-talking-real-money dept.
itwbennett writes "Confirming the rumor that emerged earlier this month, Microsoft has bought enterprise social networking software maker Yammer for $1.2 billion. Yammer will become part of Microsoft's Office Division." If you're not familiar with Yammer, it's essentially a messaging system that gives more control to administrators than does using an outside company's service, like AOL's AIM. "Enterprise social networking software," as Wikipedia explains it, means that Yammer "is used for private communication within organizations or between organizational members and pre-designated groups, making it an example of enterprise social software. ... Access to a Yammer network is determined by a user's Internet domain, so only those with appropriate email addresses may join their respective networks."
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Microsoft Buys Yammer For $1.2 Billion

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  • by Anonymous Coward on Tuesday June 26, 2012 @09:11AM (#40451397)

    From: Yammer [mailto:noreply@yammer.com]
    Sent: 26 June 2012 8:41 AM
    To: Me
    Subject: Yammer Signs Definitive Agreement to be Acquired by Microsoft

    Dear Yammer Customer,
    I am pleased to announce that Yammer has signed a definitive agreement to be acquired by Microsoft. After the close of the deal, Microsoft will continue to invest in Yammer's freemium, stand-alone service, and the team will remain under my direction within the Microsoft Office Division. With the backing of Microsoft, our aim is to massively accelerate our vision to change the way work gets done with software that is built for the enterprise and loved by users.
    As a Yammer customer, you will continue to get a secure, private social network—delivered with the same focus on simplicity, innovation, and cross-platform experiences. Over time, you’ll see more and more connections to SharePoint, Office365, Dynamics and Skype. Yammer’s expertise in empowering employees, driving adoption, and delivering rapid innovation in the cloud will not only continue to power our stand-alone service, but also anchor the communication and collaboration experiences in Office 365.
    You can find more information in this press release and our blog post.
    Sincerely,
    David Sacks
    Yammer CEO and Founder
    Don't want to receive product updates? Click here

              25% Time Savings: Download The Total Economic Impact of Yammer (April 2011), a commissioned study by Forrester Consulting on behalf of Yammer.

    • Re: (Score:1, Offtopic)

      by Quakeulf (2650167)
      "Noreply" in this day and age? Come on...
      • Yammer knows they have made a killing and absolutely lack the willingness or the balls to take responses to this decision. They know the obvious: they will be hammered for this with questions they don't want to have to answer.
        Microsoft knows sharepoint has always been complete garbage aside from certain business functionality (which ties in to what Yammer can do), so this is just an acknowledgement of an easily 10-15 year gap/weakness in their products.

        Does this acquisition fix anything? Nope. We're easily

        • Hell I like several of MSFT's products and I'll be the first to say that anyone who doesn't think Forbes was right on the money calling Ballmer the worst CEO needs to reread TFA a few times. I mean does anyone seriously believe Yammer is worth 1.2 BILLION dollars?

          It is THIS kind of shit, this right here, which is why he deserves worst CEO. Instead of actually hiring good people and more importantly giving them the freedom to innovate Ballmer simply blows through money like Charlie Sheen at a porn convention on a coke binge, which will take years to pay off as you point out but I would point out instead the likelihood it'll never pay off at all, ala Kin. This is the yahoo deal all over again on the WTF scale.

          Seriously is there NO hope of getting rid of this clown? Frankly the longer he is CEO the more the pepsi guy at Apple just looks misunderstood. The longer Ballmer is CEO the more MSFT looks like AOL, a once giant company that is so bogged down in PHB bullshit and the desire to tie everything to their core product that they couldn't innovate or have an original thought if their lives depended on it. Gates may have been an evil bastard but at least he was an evil bastard that knew WTF he was doing, Ballmer is just a buffoon.

          • by ackthpt (218170)

            I don't believe Yammer will be worth 1.2$B after all the customers flee. Maybe they have some patents in a portfolio that MS is really after.

            • Having had to use Yammer at my former job, I don't believe Yammer to currently be worth $1.20, let alone a billion times that!
          • Ballmer is just trying to show Zuckerberg who's boss after the Instagram acquisition.

            • by poetmatt (793785)

              "we'll add 20% to what was paid for Instagram, because we're top dog damnit"

              Yep, that logic actually sounds right on for MS.

    • [...]You can find more information in this press release and our blog post.
      Sincerely,
      David Sacked
      Yammer Founder and former CEO
      [...]

      FTFH[im].

  • by Anonymous Coward

    Somehow, I think the next version of their client will *NOT* run on Adobe AIR.

    • Somehow, I think the next version of their client will *NOT* run on Adobe AIR.

      Then we can say that at least something good came of this after all.

  • I mean, Lync (with federations and so on) pretty much covers every "locally admistered" instant messaging + file sharing + desktop sharing + voice + video needs you have...and it works across organization boundaries. So what is Yammer for?

    • Re: (Score:3, Interesting)

      by DaneM (810927)

      So what is Yammer for?

      Maybe it's for helping bosses to feel less jealous of your Facebook account, so they don't have to demand its password?
      *rimshot*

    • Re: (Score:2, Interesting)

      by chrish (4714)

      Probably for buying out and shutting down a potential competitor?

      Or maybe they've got good Mac integration, since MS's Lync support on Mac is sort of half-there (it's basically just Communicator, there's no group support, etc.).

      • Maybe they need them to add a SPELL CHECKER TO THEIR MESSENGER...like really now. its been fracking 12 years with MSN and still no spell checker support. What confuses me even more is that they already have the spell checker library that exists for word / office and all they will need to do is link it.
      • Yammer is not a competitor to Lync, though. I don't know what prompted GP to even make such a connection. As TFA says, it really is a "corporate social network", nothing more.

  • I've never used Yammer but that price seems awfully high considering how simplistic it sounds. I think they could have recoded a similar but more fitting product for their company for a lot less money. It sounds like an IM program with a bit of security restrictions. I think there's a dozen or so of those on sourceforge that were made for significantly less than $1.2bil.
    • by crazyjj (2598719) *

      I think there's a dozen or so of those on sourceforge that were made for significantly less than $1.2bil.

      And how many of those have licenses that let you incorporate them into proprietary commercial software without making the code available?

    • Re:a bit high (Score:5, Informative)

      by buchner.johannes (1139593) on Tuesday June 26, 2012 @09:34AM (#40451651) Homepage Journal

      They are not buying the technology/software, they are buying the customers and market share ("three million users and 80,000 companies worldwide, including 80 percent of the Fortune 500" according to Wikipedia).

      • Exactly. Microsoft could build something like this easily. The hard part is signing up companies.

        I'm shocked that there are 80,000 companies actively using it though. That seems absurdly high to me, especially since I've never talked to anybody who has anything more flattering than "meh" to say about Yammer.

        • by flatt (513465)

          Meh is right. Lies, damn lies, and statistics. You could say my company uses it. Of the roughly 2200 people that work here, I believe 5 have Yammer accounts.

      • by Hillgiant (916436)

        Still. Is each of those users worth $4,000?

        • No, but some of those users - the ones that make purchasing decisions - may well be worth more than that.

        • You're off by a factor of 10, it's $400. Also remember valuation is a price to earnings calculation, so a typical P/E value of 15 means a user should provide revenue of $27 per year. Using the company figure that's $1,000 per year average which is not a ridiculous amount to expect a corporation to pay for this software.

      • by houghi (78078)

        they are buying the customers and market share

        That is 400 USD per user or 15.000 USD per company. It shows how much I am worth and that is why I do not want to sell my privacy to companies for just free email or some other stuff.

        I am not getting stuff for free. I am being robbed and they should at least give me a value of 400USD or my company a value of 15.000 USD.

    • I'm assuming Microsoft is mostly buying an existing Yammer customer base. I didn't look at their revenue figures, but on the Yammer website they claim four million users at the end of 2011.

      At this point, I think Microsoft is fighting a losing battle for users against iOS and Android. I think it will be years, maybe decades, before Microsoft software is not present in any form in most homes and businesses around the country. But it looks like the trend is in that direction. We already use tablets and
    • It is more precise to describe Yammer as a service that lets you create private social network for your company. Just like with Facebook IM is just small part of it. Enterprises of course have different needs for their social network than regular Facebook folks. For example Sharepoint integration, SSO solution, etc.

  • 1,200 MILLION!? (Score:4, Informative)

    by DarthVain (724186) on Tuesday June 26, 2012 @09:41AM (#40451731)

    Seriously? What is with the overpayment of these companies.

    Is this like sports, and high priced overpaid players. Where stupid GM's pay ridiculous prices because they know other stupid GM's will also pay ridiculous prices?

    i.e. we better shell out 1.2 Billion for these guys before Apple, Google, Facebook, etc... do!

    • It's $30 per user, right? That doesn't seem that crazy to me. How would you evaluate the value of something like Yammer?

      • $30/user for what? A few lame tweets (yamms?), real name, work email, work phone number, and a rough org chart?

        Yeah, that seems very high to me, especially considering how many of those users are probably in the same "log in once or twice a month to see if anything is going on" category as I am.

        • Yammer isn't entirely free. It isn't hard to see how the business might be worth considerably more than $30 / user. If their revenues are in the hundred million ballpark, I think it might be a solid buy.

  • Why Yammer is Lame (Score:5, Interesting)

    by geoffrobinson (109879) on Tuesday June 26, 2012 @09:43AM (#40451755) Homepage

    It is basically an internal Twitter for a company. At least for larger companies, you have upper management giving out tweets (or yams or whatever they want to call them) until they get bored with it. Low-level employees are afraid to write anything interesting out of a fear of accidentally writing something management will get upset about. So you get to see a few boring posting from upper management and that's about it.

    Take away the fear and it would be a good internal tool for a company. However, there is no barrier to entry for competitors.

    And that was my experience with Yammer.

    • by Anonymous Coward on Tuesday June 26, 2012 @10:29AM (#40452181)

      (Posting anon because I'm a coward.)

      My company began using Yammer (more heavily) several months ago. I signed up during the initial "light usage" period and found it was just crap... I don't know that there's a way to unsubscribe from the company-wide feed, and I'd be seeing all kinds of garbage about things I didn't care about from people I didn't know. We've now got many sub-groups to which I'm subscribed, but even then it's annoying. The main driver for using Yammer was that we had (and are still having) massive problems with our Exchange servers delivering mail (which is a symptom of a much larger and more expensive security problem). It became the next-best way to communicate with Infrastructure people when shit was hitting the fan when our own infrastructure simply couldn't stand on its own.

      The difference between Yammer and others is that it's "strongly encouraged" by my employer. I avoid using the desktop app, don't visit the website, but instead have selected group messages get forwarded to Google Chat. Otherwise the S/N ratio is just too much to bear. I don't want to be "friends" with these people -- they're co-workers, many of whom I can't stand. I don't want to be social. I don't want it to be a Facebook for Work. I'd avoid it altogether, if I could. Contrast that with FB where I (for the most part) enjoy reading things from people with whom I'm good friends, family, etc. People visit Facebook and Twitter (and others) because they want to and they like to. Employees go to Yammer because they HAVE to. Bleh.

      • "People visit Facebook and Twitter (and others) because they want to and they like to. Employees go to Yammer because they HAVE to. Bleh."

        Sounds like the perfect Microsoft acquisition.

    • by Anonymous Coward

      That seems more like a problem with your company's politics than the tool. I work for a pretty large company (120,000+ employees) in which Yammer use is strongly encouraged for communication between disciplines, business units and regions and it's used extensively for sharing technical information, voicing opinions and sometimes just chatting about industry news or just plain nonsense. People use it to ask for solutions to problems, talk about their new phone or ask for the company's official line/catalog

    • by Anonymous Coward

      This is the exact experience I had with Yammer at my company. I don't know anyone who still uses it other than upper management to send out wank-fest posts about how awesome we are.

  • Office 2013 Communicator for Windows (Premium|Business|Home) Edition 1.0 for Windows 7/8.

  • by bazorg (911295) on Tuesday June 26, 2012 @10:25AM (#40452147)

    I have experimented a bit with Yammer, to find that its user interface is as simple to use as Facebook and similar websites. Adding photos or any kind of document to a Yammer "repository" seems to me like it will make it easier to search and find it later on.

    In comparison, my (also limited) experience with SharePoint is that if internal communications in a company were handled there rather than via email, stuff would be easier to find and actual knowledge bases for products and client projects would become easier to create and maintain.

    The problem with SP (IMHO) is that it's not as easy to use as email or any common website. It is very easy to feel discouraged from using it and just keep sending email attachments all the time. I suspect that the existing developments that bridge Yammer and SP will be very useful to help the adoption of SharePoint in those 80K companies already using Yammer.

    • by bbbaldie (935205)
      Actually, SP2 was a pretty danged intuitive package. I'm a PHP developer, and am very unimpressed with most asp.net web things I see, but SP2 blew me away. Its main virtue was ease of use. Along comes SP3, and MS finally realized that they had created a usable interface and needed to fix it immediately. All versions of SP after 2 have gotten heavier, kludgier, slower, and more confusing to use. In short, they show the same innovative thinking that the Office ribbon does. If you like the ribbon, you're proba
  • Than anything else, reminds me of the Facebook Instagram acquisition.
    • by Flipao (903929)
      And as usual Microsoft moving to where the ball is instead of where it's going to be.

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