Today was historic day for Microsoft. Microsoft is acquiring Linked In. And it joins the 443,000,000 other users in a new capacity – as an owner of the Professional Networking Services firm.
Only about 5-6 years back, there was caution about endorsing folks on social networks including Linked In. And now Microsoft owns it. Thousands of folks use Linked In to make the important decisions in their lives – change jobs and careers. They will benefit from the productivity suite that powers millions of users worldwide.
There are lengthy conversations in many networks and at dinner tables (if not at the breakfast and lunch tables) about this historic acquisition. See FD Thread for a sample.
When I worked for Microsoft, I longed for a way to discover more details about others, especially professionals, to engage them in new business opportunities to use my team’s product. There was no easy way to discover besides the big global address book, that was slow and often used for security, not for networking purposes. Then when I discovered LinkedIn, a lot more experiences came to life. Now the new Microsoft people and others worldwide may have the benefit of LinkedIn.
Here are some takeaways I had about the acquisition.
First off, this is a big move for Microsoft – the biggest acquisition of users, technology, at highest cost ever.
a. Finding large number of active users is hard. Linked In brings a treasure trove of users, that too, connected users. With real data, real email, and for most part genuine professional information, Linked In offers a great platform of user information that even the best of directory or email systems have.
b. Linked In, relatively speaking has been a pioneer of open source software in messaging, big data, analytics, tooling, etc. For a company that is opening up to the new open source possibilities like Microsoft, this is a big technology plus. Perhaps more MAC machines will join the Microsoft internal network as well, besides a slew of new tools being introduced.
c. Enough said about cost of acquisition. It is about $60 per user or $260 per active user, depending on how you count. All it takes is to sell a copy of Office to each user and Microsoft might recoup its purchase price.
Second, there are likely synergies and opportunities for optimization. I trust that the investment bankers and executives have thought through this. Even better …
Third, there is opportunity for growth – cross-selling, up-selling, etc. between the professional network and professional applications. It is hard to find the second in-line competitor for professional networking. So I am sure competition has a tougher uphill climb. (hey, that is at least opportunity for new startups to spring up and handle the challenges – moving profiles from LinkedIn, creating new connections, etc.)
Fourth, competition has a tough new frontier to take care of. The world is moving towards our private information become more public. I wonder about all the private threads in LinkedIn which are now available as part of a large data processing machinery. And competition cannot get the same data easily, which means challenges abound. Perhaps the Linked In engineers will farm out and create new startups to carry the flag forward. And the valley will be flush with new capital to invest in more ideas.
Finally, it is exciting times to watch ahead about what may come. Perhaps we have Microsoft and others compete to bring better offering to professionals and businesses in the world. I look forward to this story to emerge.
PS: All these are my own opinions informed from threads above and from elsewhere.
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