In a match being made for the cloud, the software giant Microsoft is acquiring a professional social networking site Linked In for $26.2 billion in cash. By teaming up, the companies aim to connect the Microsoft’s more than 1.2 billion users of Office — and the other cloud-based offerings —with the LinkedIn’s 433 million-plus mobile-friendly members in ways that transform the workplace. The LinkedIn’s news feed will be smarter for our Microsoft Office calendar will know what’s coming up on our schedule, said the Microsoft CEO Satya Nadella.
The Office software suite will have Linkedin’s training courses in the programs such as an Excel, Word and the PowerPoint baked in, he said. In a more futuristic vision, the Nadella foresees Microsoft’s artificial intelligence assistant Cortana serving as our networking caddy. “Imagine you are walking into a meeting and the Cortana now wakes up and tells you about the people you are meeting for the first time and also tells you all the things you want to know before walking in and knowing someone because it has an access to the professional network,” as he said.
The Microsoft likely sees the potential of connecting an Office Graph and The intelligent workplace collaborative platform with the LinkedIn’s network, says TJ Keitt, a senior analyst with the research firm the Forrester. “This is the data play in many respects. In an enterprise market, the Microsoft wants to create a new platform for work that makes it an easier for the employees to collaborate and get things done,” he said.
While the Microsoft is paying the premium for the Linked In, a software giant should gain from an acquisition, says the Mizuho Securities analyst the Neil Doshi. “This transaction makes a sense to us. We’ve always considered the two potential Acquirers for Linked In – the Salesforce or the Microsoft,” he said in a note to investors. The deal does not only help the Microsoft in an office, but also on the social media, he says Microsoft has fallen behind in the consumer Internet sector, and this deal gives the Microsoft 433 million social Linked In members that are growing.
Doshi also said that Just as an important, 60% of the Linked In users are on the mobile, and this should accelerate the Microsoft’s consumer ‘Net mobile presence” in the market. As for the Linked In — besides the hefty payout — it stands to expand its recruiting, advertising and the sales programs through the Microsoft’s extensive business and its consumer connections. The Outlook.com of Microsoft alone has the 400 million active users and the Microsoft Office has been downloaded 340 million times on an Android and a iOS device, according to the Microsoft.
The companies said that their respective boards had also unanimously approved the deal. The Linked In CEO Jeff Weiner will keep the title and report to the Microsoft Nadella.