Microsoft – I bought LinkedIn
Me – Wow!!! But Why?
MS – I liked it, it would help me
Me – Did Nokia ($7.6 billion) helped?
MS – Nah, not really.. we wrote it off within One year
Me – Did Yammer ($1.2 bn) helped?
MS – Nah, we are trying to fig it out past 4 years
Me – What about skype ($8.5 bn), it must have helped?
MS – it was lost in cupboard, we just pulled it out
Me – What about aQuantive ($6.3 bn) ?
MS – We wrote it off in 5 years..
Me – Rich people have expensive habits
Microsoft announcement that it is acquiring LinkedIn was too sudden and quick for many. LinkedIn which has about 433M registered users, and about 105 million monthly active, was bought for $26.2 billion, or $250 per active user. Compare this to FB’s acquisition of WhatsApp at $22 billion, which has 400 million active users, was at $55 per user. While both the deals can’t be compared, as LinkedIn has far in-depth rich data for the user and WhatsApp had just usage.
Microsoft has spent $23.6 billion over last 9 years, trying to do acquisitions, and none of them have reaped benefits to them. So acquiring LinkedIn is just another expensive shopping or will they do something about it, needs to be seen.
LinkedIn is one the best business sales tool, and Microsoft can use it and push it to compete with salesforce.com. It can integrate its CRM suite, Dynamics with LinkedIn and they can have a very powerful business tool. But they don’t seem to have a track of doing so. Skype, which was a front runner in messaging apps, could have been worked upon to be what WhatsApp or any other messaging tool is, but instead they choose to keep it in shelf for 5 years, before they announced a strategic overhaul.
The other way to argue is that how would this social layer of professional people help sell Microsoft products. We can argue that this doesn’t seem to have the strategic fit.
Satya Nadella explained in an email to Microsoft employees, “ This combination will make it possible for new experiences” such as “Office suggesting an expert to connect with via LinkedIn to help with a task you are trying to complete”. I don’t know about others, but maybe at that point I would stop using word. When I am using word or excel, I am working and last thing I want in an intrusion. Didn’t he remember the Clippy Disaster? Clippy the animated paper clip that was introduced in 1996, which popped up whenever you were trying to do something. Time magazine included that in the list of 50 worst inventions in 2000.
Microsoft hasn’t revealed in their plans on how they would integrate or leverage that, but that is the bigger question. Do they have plans or its just another expensive shopping that would sit idle with them…
