Microsoft Gets Nod on LinkedIn Acquisition from the European Commission

By Don Addington

President, NPI

December 08, 2016
Tags
IT Microsoft

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Artwork Courtesy of @iStock.com/hanibaram

When Microsoft makes an acquisition, the world listens. Especially when that acquisition is LinkedIn at a price tag of $26 billion. Earlier this week, the European Commission gave its blessing on the condition that Microsoft allow competitive professional networking sites to integrate with its applications and services for the next five years. With all major hurdles crossed, the market anticipates a swift transaction from here on out.

So, what impact will this have on enterprise customers? A few things come to mind:

  1. Get ready for Office 365 to be a lot more powerful. The marriage between LinkedIn profiles, contacts and newsfeeds with Microsoft’s own CRM and project collaboration capabilities could be impressive.
  2. Salesforce.com will have to be more competitive. Historically, Salesforce.com sourcing events have been tough to negotiate. That may change given that Microsoft’s acquisition of LinkedIn has put them in even more competitive territory with Salesforce.com. In short, if you’re doing a deal with Salesforce.com in 2017, this acquisition has the potential to give you a leverage boost.
  3. Microsoft customers will foot some of the bill for LinkedIn. $26 billion isn’t exactly spare change, and Microsoft can’t afford another lackluster acquisition (remember Nokia?). It’s also important to remember that Microsoft is still mid-transformation into its desired cloud-first state –on-premise software revenues are declining and cloud revenues are only just starting to reach their potential. To drive revenue growth, expect more licensing audits, changes to product use terms and pricing adjustments (for both cloud and on-premise solutions) in 2017.

These are just a few scenarios to consider. The benefits and fallout of this acquisition will be monitored closely both industry-wide and here at NPI as we help customers optimize Microsoft purchases in 2017. What do you think? How will this acquisition impact Microsoft’s enterprise customers?