Microsoft acquires enterprise social network Yammer for US$1.2 billion

Microsoft has acquired Yammer for US$1.2 billion, in an attempt to gain inroads into the enterprise social networking market.

The move follows a recent trend in enterprise software, with many vendors adding social elements to their products, seeking to tap into the strong consumer appetite for social networking.

“Many employees at the junior (and now senior) end of the workforce live aspects of their personal lives through Facebook and Twitter, so the idea of introducing similar kinds of tools into the workplace seems to make sense from a communication and collaboration point of view,” said Richard Edwards, Principal Analyst at Ovum.

And while Microsoft already had its own enterprise social tool - SharePoint Server - this was conceived in a time before social networking really hit its stride in the consumer space.

Edwards said Yammer is “a new breed of enterprise collaboration solution, designed from the ground up to exploit social, mobile and cloud technologies, and would sit neatly alongside Skype, the communication product that Microsoft acquired this time last year for $8.5 billion”.

“Microsoft’s acquisition of Yammer will undoubtedly have an opportunity impact at the commodity end of the enterprise social networking spectrum, but if Google and LinkedIn can address this aspect of the market with a compelling proposition then all is still to play for,” he said.