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Microsoft To Buy Yammer

Confirming earlier reports, Microsoft officially plans to buy enterprise-focused social networking provider Yammer for $1.2 billion.

“Yammer will join Microsoft's Office division, with the team continuing to report to its current CEO David Sacks,” The Verge reports. “It sounds like the service will continue on in its current form, at least for the near-term … with (Microsoft) looking to accelerate Yammer's adoption alongside complementary offerings."

“Launched in 2008, Yammer has been the most promising of the social enterprise companies not named Jive,” as AllThingsD puts it.



“The purchase could give Microsoft a social dimension to its popular corporate software products,” writes GigaOm. “Yammer creates a Facebook-like experience for business clients.”

“Adding Yammer could definitely help Microsoft provide its software customers with social-networking tools and beef-up the suite of products it offers corporate customers,” suggests VatorNews. Yammer currently has over 5 million corporate users, with 85% of Fortune 500 companies using the service.

Yet, for what it’s worth, since reports first surfaced of a possible Microsoft deal, Yammer rival Jive Software tells Bloomberg News that it has seen an uptick in inquiries from concerned Yammer customers. “Not everybody is a huge Microsoft fan,” Jive CEO Tony Zingale informs Bloomberg.

Like rival Jive, many had expected Yammer to pursue a public offering. “Coming as it did on the heels of Jive’s late 2011 IPO, conventional wisdom suggested that Yammer would follow and go for an IPO of its own,” adds AllThingsD.

Last February, Yammer raised a fifth round of funding -- $85 million led by Draper Fisher Jurvetson, at an implied valuation of about $600 million.


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