Here’s why Microsoft chose LinkedIn

Microsoft’s LinkedIn acquisition topped headlines and confounded tech experts. The price of US$26.2 billion paid, the biggest in Microsoft’s history, implies the company’s determination in securing its place in the cloud. Even if the buyout bears little fruit, Microsoft will still chug along like it always has. The company has plenty of ways to spread the costs through accounting methods, lots of extra cash, and a solid credit rating. LinkedIn’s contribution to Microsoft’s cloud apps will matter most. But will the online job site deliver?

LinkedIn laptop

People primarily use LinkedIn to find a job. If Office 365 or any of the collaboration tools integrate LinkedIn openly, how do companies prevent staff from getting poached by other companies?

LinkedIn has talented engineering staff. The same staff re-engineered and re-built the open-sourced social job site from the ground up. This move was pivotal in supporting the enormous growth that followed. Microsoft’s packaged software is not open source nor is its cloud solutions.

Will this mean there is a cultural clash ahead as Microsoft integrates LinkedIn’s technology? Does it mean LinkedIn must stay a separate entity? Neither company would benefit from any limitations in bringing the two ecosystems (Office365, Azure, etc.) together with that of LinkedIn.

Microsoft’s CEO said: “Think about it: How people find jobs, build skills, sell, market and get work done and ultimately find success requires a connected professional world. It requires a vibrant network that brings together a professional’s information in LinkedIn’s public network with the information in Office 365 and Dynamics. This combination will make it possible for new experiences such as a LinkedIn news feed that serves up articles based on the project you are working on and Office suggesting an expert to connect with via LinkedIn to help with a task you’re trying to complete.”

Microsoft Windows and Skype

A cohesive, professionally-minded network is conceptually beneficial for Microsoft’s cloud solutions. The potential risk here is assuming the collaboration team will share project-related posts in the LinkedIn news feed. If staff already know each other or their partner teammates, then why connect via LinkedIn? The sooner Microsoft releases a beta product incorporating LinkedIn’s network, the sooner Microsoft builds a big pool of enterprise users.

Alternative acquisitions

Slack is a newer, cheaper, and smaller acquisition Microsoft may have considered. Project collaboration relies heavily on communication, group content sharing, and project timeline sharing. Slack centres the social network around a project or team. The site also allows for file sharing. Slack overlaps with Skype and OneDrive. This overlap only strengthens the idea that Slack may have been a better fit in bringing messaging and file sharing together.

Twitter is another site Microsoft might have considered, too. Unfortunately, Twitter’s “social” targets the consumer and advertorial market. Microsoft’s present and future growth is in the enterprise. Still, Twitter’s superior technology in the microblogging infrastructure and handling of massive data is valuable. Microsoft could have applied this to its SharePoint or Azure solutions.

History does not favour Microsoft when it comes to acquisitions. Yammer should have brought social networking to the company. Nokia’s devices unit should have kept Microsoft’s mobile strategy in play.

Skype should have out-competed WeChat, Facebook Messenger, Google Hangouts, BBM, and a slew of other chat programs.

There is hope Microsoft has an open mind with adapting the open-source architecture from LinkedIn in its own products. If it does, LinkedIn may help Microsoft develop better products that support collaboration.

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Jim Love, Chief Content Officer, IT World Canada
Chris Lau
Chris Lau
In search for alpha. Telecom, media, technology. Social media. Financial Markets. Real-Estate Agent. Seeking Alpha Contributor. Toronto, Ontario ·

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