And The Next Big Social Network is… Microsoft?
by Joe Martin
posted on 06-13-2016
Mondays are generally pretty slow. I get up, check my email from the night before, read some news, take a shower, help get my boys ready for the day, kiss my wife goodbye, and head to work. This morning was a little different. As a head of social insights at Adobe, I soak up any news I can about updates or changes that happen with Facebook, Twitter, Insta, Snapchat, and LinkedIn. When I saw the headline in the Wall Street Journal, Microsoft to Acquire LinkedIn for $26.2 Billion I began thinking about all of the possibilities and how we got to this point in social. To understand where we are now it may be best to look into the past at a few big social acquisition.
2006 Google buys YouTube ($1.65 billion)
YouTube was a struggling startup and Google was a relatively new company. This may have been seen by some at the time as a gamble by the emerging tech company for a brand that was mired in legal battles over piracy. However it led to a video revolution that has only increased over the last few years. YouTube is now valued at over $70 billion and I can always find that old Chris Farley clip, in a Google search of course, from Saturday Night Live when I want to share it with someone.
2012 Facebook buys Instagram ($1 Billion)
Instagram turned everyone into a professional photographer and launched the next big social network. In the 2015 social intelligence report that I did for Adobe Digital Index, we showed that images were the most engaging of all social content How much is a filtered image worth? The most recent valuation of Instagram comes in at just over $37 billion.
2016 Microsoft buys LinkedIn ($26.2 billion reported)
My four horsemen of the techpocolipse (Facebook, Google, Amazon, and Apple) may need to make room for a fifth in Microsoft, who just got a little bigger and provides even more legitimacy to social integration in our future business world. On CNBC Squawk Box, Ivan Feinset of Tigress said, “LinkedIn is the ultimate business social platform. You have everybody on this, from interns and college students on up to the biggest CEOs.” He continued, “This is a good way for Microsoft to expand in social platforms.”
It has yet to be determined if the Microsoft acquisition of LinkedIn will pay off as well as the Facebook and Google ones have. However, CEO Satya Nadella said in his memo, “This deal brings together the world’s leading professional cloud with the world’s leading professional network. I have been learning about LinkedIn for some time, while also reflecting on how networks can truly differentiate cloud services. It’s clear to me that the LinkedIn team has grown a fantastic business and an impressive network of more than 433 million professionals. We are in pursuit of a common mission centered on empowering people and organizations.”
The acquisition by Microsoft shows that the company is fixed on a cloud computing future. The largest business social network will fit in nicely as an offering to its existing cloud services and could provide additional value to the Azure project. In addition, the 433 million professionals who have probably used Microsoft products in the past can be harnessed as brand advocates and future cloud customers. For LinkedIn it will provide additional cash flow to continue to increase its strong viability in the crowdsharing news space and potential growth as a messaging app. There are a lot of future synergies between the two companies and I look forward to seeing how the LinkedIn Cloud will look.