Microsoft Corporation announced it was purchasing social network site Yammer for an estimated $1.2 billion. Yammer will be incorporated into the Office division of Microsoft that Kurt DelBene heads and will continue to report to David Sacks the founder and current CEO of Yammer.
Sacks founded Yammer in 2008, which offers services similar to Facebook to businesses and has over 5 million active corporate users that represent over 85% of the companies in Fortune 500.
The basic product offered by Yammer is free, with revenue generated from versions that are more advanced, including improved security and administrative controls, priority customer service, integration that includes enterprise applications and a designated customer manager.
Microsoft announced it plans to use Yammer’s service as a separate product from other Microsoft services, although over the long term it will be integrated with Office 365, SharePoint, Skype and Dynamics.
Sacks said that with Microsoft the company aim is to accelerate their vision to change how work is done in the workplace with software built for the enterprise and loved by its users. He said that as a customer of Yammer you keep receiving a secure and private social network that will be delivered with the continued focus on innovation, cross-platform experiences and simplicity.
KnowledgeTree, the document management business is one user of Yammer and its senior direct of marketing cautioned that Microsoft must put its focus on maintaining easy implementation and up to date products. Upon the integration of Yammer into the Microsoft world, temptation will be to broaden the solution more than is necessary. The marketing director said to keep Yammer as simple as possible.