Microsoft Corporation (NASDAQ:MSFT) actively pursued getting into the social media space, and last summer consummated a courtship with a $1.2 billion acquisition of Yammer. After about six months since the acquisition, Microsoft chose this week to give a progress report on the growth of its new property.
While Yammer is meant as an enterprise social platform – which makes it ideal for Microsoft Corporation (NASDAQ:MSFT) and its overall bent toward the enterprise – the numbers reported this week indicate some very positive and robust progress for the company, though it likely won’t come close to more individualized social platforms like Facebook Inc. (NASDAQ:FB), Google Inc. (NASDAQ:GOOG) Plus or Twitter. However, Yammer did report through co-founder and Microsoft Office vice president David Sacks said, “Yammer experienced banner growth in 2012 and grew particularly fast in the fourth quarter. Our momentum is definitely accelerating following the Microsoft acquisition.”
Microsoft Corporation (NASDAQ:MSFT) noted that Yammer passed the 7-million-user mark at the end of 2012, after being at 5 million when Microsoft CEO Steve Ballmer talked about Yammer at the inaugural YamJam in October. That would signify about a 40-percent growth just in three months. In the year that ended Jan. 31 of this year, Yammer reported that paying customers were up about 165 percent over the previous year and overall sales nearly tripled. But how mainstream is enterprise social? Microsoft says that Yammer has signed on such companies as T.G.I. Friday’s, GlaxoSmithKline plc (ADR) (NYSE:GSK) and Rio Tinto plc (ADR) (NYSE:RIO), plus “nine of the largest” retail chains and “four of the largest” financial-services firms have become Yammer customers.
“The power of the ‘freemium’ model and the validation that Microsoft brings to Enterprise Social Networking is helping drive mainstream adoption among leading organizations,” Sacks said. “Enterprise Social Networking is becoming the cornerstone of workplace collaboration for its ability to empower people and drive employee engagement, team collaboration and business agility.”
What are your thoughts about enterprise social? Is Microsoft Corporation (NASDAQ:MSFT) the right company to develop Yammer and the enterprise niche? How do you see Yammer’s role in positioning Microsoft in the technology space going forward? We’d like your thoughts in the comments section below.
DISCLOSURE: I own no positions in any stock mentioned.
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