Why a Microsoft buy of Yammer would be good for social business

Rumours are buzzing in Silicon Valley at the moment after an overheard conversation in The Creamery in San Francisco last night.

The bistro and coffee shop is just a short walk from Yammer's office on Townsend Street.  Sarah Taylor tweeted that she had overheard a conversation that Microsoft had acquired Yammer. Bloomberg picked up the story, speculating that Microsoft might pay more than $1 billion for the acquisition.

It would make really great sense for Microsoft to buy Yammer.

Yammer is an enterprise social network provider which allows employees to collaborate across departments, geographies, content and applications. It encourages adoption by offering its basic product for free, gambling on the fact that companies will return to buy the premium version of the product.

The acquisition would probably sit within the Unified Communications team. Yammer would nicely complement existing functions and features of Microsoft Lync whilst bringing together Lync and SharePoint.

Yammer first integrated its platform with SharePoint 2007 and SharePoint 2010 a couple of years ago. This integration exposes the Yammer feed from within SharePoint pages through a Yammer SharePoint Web Part.  Documents and files can also be posted to Yammer from SharePoint document lists.

Microsoft may have been searching for a suitable acquisition like Yammer for some time. It had been developing Townsquare, an enterprise news feed which exposed information from several back end sources inside the firewall.

The Townsquare web-based UI showed information about people in workgroups and virtual teams. It showed employee length of service, birthdays, SharePoint documents and status updates in a centralised Facebook-like portal.

Another good fit for Yammer would be if the acquisition rested in the Microsoft Dynamics team. Last year the Dynamics CRM product was updated to bring a more unified experience to the ‘Enterprise cloud’.

Activity feeds, micro blog status updates, conversations and automated activity updates posted directly to the activity feed kept users informed of progress in sales opportunities.

Earlier this year, Yammer integrated its services with Microsoft Dynamics, offering Universal Search across enterprise applications and devices. It also secured $85 million in funding in February 2012 and believes that there is a significant growth opportunity for its business.

In February Yammer also announced an integration with SAP and five other partnerships.  This means that Yammer users will be able to see and collaborate around SAP content, and other activity from partners.

Yammer is used by 85% of the Fortune 500 and a significant amount of the Global 2000 where SAP is widely deployed. This integration makes sense if Yammer is to continue to gain market share.

Overlap is also important amongst large enterprises in Yammer's customer base.Other Yammer partnerships include GageIn, a business content aggregation platform and Moreover Technologies, used for media monitoring.  Activity in the workplace is becoming much more social.

Adding a social layer to business processes means data can talk to you, even the software is complex on-premise software such as SAP. But SAP is not the only partner to work with Yammer.

It is a continuation of the partner strategy Yammer launched back in November with the introduction of its Ticker service. This feature shows what co-workers are working on, showing real time stories from Box.net and other integration partners such as, NetSuite, Zendesk, Expensify and Tripit.

So if, and it is a big if, the rumour happens to be true, then Microsoft will have scooped a fast growing, energised social business operator.

Microsoft subsuming Yammer could really benefit enterprise social business. If Yammer can still remain viable as a collaborative enablement tool -- and does not become another logo on the 'acquisitions wall'.

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