And so the rumors were true. Microsoft has acquired Yammer for a whopping $1.2 billion.
The deal makes a lot of sense for Microsoft, as the company that was once a collaboration king (thanks to SharePoint) has spent the last few years in the hot seat for a lack of modern social functionality. To add insult to injury, most enterprise customers have moved away from the SharePoint sales model in favor of the testable, noncommittal freemium approach.
As for what it means for Yammer, the move has been met with both criticism (from Sarah Lacy — no surprise there) and three cheers (hip hip hooray!).
For the rest of us, the acquisition further supports what we already know: social business and cloud-based delivery are both here to stay. Because they’re becoming the standard. The Microsoft/Yammer deal follows a number of acquisitions aimed at improving enterprise-level collaboration, as well as Facebook’s famous — albeit rocky — IPO.
Forrester expects that Enterprise Social Software products will grow at an annual compound rate of 61 percent over the next five years, with the market exceeding $6.4 billion by 2016. Today’s purchase certainly lends a lot of faith to that prediction, as well as the confidence startups need to get their product off the ground. If there’s one thing the entrepreneurial pool should take away from today’s news, it’s that you should not, for any reason, quit innovating. Products like Sacks’s have only scratched the surface of functionality and success.
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