In yet another episode of "No one could have imagined this", the Redmond giant announced the purchase of LinkedIn, the social network aimed at professionals. The deal still needs approval from the relevant agencies (which could happen before the end of the year), but considering that Microsoft has already published a video with the CEOs of both companies together, I think we can take the union for granted. The magic number? You might want to sit down: $26.2 billion.
With PC sales shrinking more and more, a flagship operating system struggling to break the 20 percent margin barrier, and a virtual surrender in the mobile space, Microsoft did something we've seen on more than one occasion: Cause an earthquake with a gigantic purchase. This time it's LinkedIn, the social network that connects professionals around the world, which has more than 400 million registered users. The strategy is clearer than it appears: Microsoft is doing things very well in the cloud, especially with everything surrounding Azure. Combining the world's largest "business social network" with the world's largest "cloud platform" makes sense... until we find out what Microsoft paid (or rather, plans to pay) for LinkedIn.
https://www.youtube.com/embed/-89PWn0QaaYThe Price Tag
The total amounts to $26.2 billion, more than 26 times what Facebook paid for Instagram, a service that had just 30 million users at the time. According to data published by LinkedIn last March and taking its 433 million users (of which 106 million are active each month) as a reference, Microsoft plans to pay over sixty dollars per user. In the coming months, we will see greater integration of LinkedIn into Microsoft's main services, including Office 365, Skype, and even Cortana. Finally, Microsoft has said it will guarantee LinkedIn's independence and will even keep its current CEO, Jeff Weiner in that position.
The Big Picture
In summary, the acquisition of LinkedIn confirms two very important facts for Microsoft. The first is its definitive entry into the ring of social networks, perhaps not in the traditional sense as we see it with Facebook and Twitter... but it has just added more than 400 million users to its base. Second, several media colleagues talk about a "post-Windows" transition for the Redmond giant, and if we think that Windows 10 is more of a service platform than an operating system, we should follow that line as well.
