Microsoft and LinkedIn announced on Thursday that they had closed the deal in which the software giant will acquire the professional networking site for over $26 billion. The final hurdle the agreement had to clear was approval from EU antitrust regulators, who insisted on certain concessions from Microsoft, according to the Wall Street Journal:
The European Commission, the bloc’s executive arm, said it was clearing the deal on the condition that, postmerger, Microsoft allowed other professional networking sites access to programming commands for its Office applications and cloud-computing services for the next five years. It must also grant computer manufacturers the option not to install the LinkedIn shortcut on desktop devices, the EU said. …
The concessions are mild. Microsoft already offers its Office Add-in program to professional social-networking services. Giving rivals access to its cloud-computing system could ultimately benefit Microsoft, because companies that took advantage of that system would use Microsoft products to do so.
In a blog post at LinkedIn (where else?), Microsoft CEO Satya Nadella outlines the current plans for integrating LinkedIn with Microsoft’s suite of software products:
In the immediate term we will pursue a specific set of integration scenarios, for example:
- LinkedIn identity and network in Microsoft Outlook and the Office suite
- LinkedIn notifications within the Windows action center
- Enabling members drafting résumés in Word to update their profiles, and discover and apply to jobs on LinkedIn
- Extending the reach of Sponsored Content across Microsoft properties
- Enterprise LinkedIn Lookup powered by Active Directory and Office 365
- LinkedIn Learning available across the Office 365 and Windows ecosystem
- Developing a business news desk across our content ecosystem and MSN.com
- Redefining social selling through the combination of Sales Navigator and Dynamics 365
As we articulated six months ago, our top priority is to accelerate LinkedIn’s growth, by adding value for every LinkedIn member.
“Rumors have also been percolating of a potential new website redesign that could arrive in the United States as early as next week,” ERE’s Shannon Pritchett adds:
A preview of the newly design website shows vast similarities to the mobile version and mobile application of its product. Users can expect new messaging features, which are designed to be competitive with Slack and Facebook Messenger. Improved messaging capability could be a huge win for sourcers and recruiters alike. The ability to message candidates via a chat over an InMail or LinkedIn message could be a real time saver.
Missing from the mobile application and mobile version of LinkedIn are its groups. LinkedIn removed its cap on the number of groups a member can join. In the past, LinkedIn limited its users to a maximum of 50 groups. Group interest and activity has steadily declined on LinkedIn, which has many speculating that this feature could be retired in the near future.
When the planned acquisition was first announced in June, commentators expressed mixed views of whether the acquisition would succeed, with skeptics predicting that both employers and employees might balk at having a social media platform more deeply embedded in their work lives. Now that the deal is sealed, the New York Times’ Nick Wingfield takes a sober look at its prospects, asserting that “there are ample reasons to be skeptical that the deal, the biggest by far in Microsoft’s history, will pay off”:
First, the company has not had a great track record with this sort of thing. Two of Microsoft’s largest acquisitions — the digital advertising firm aQuantive and the mobile unit of Nokia — were disappointments that eventually led to the company writing off nearly the entire value of the deals, more than $13 billion in all.
And Microsoft is not the only big company that has ended up wasting money on acquisitions. In fact, decades of research by academics and consulting firms have shown that from 60 to 80 percent of mergers and acquisitions end up destroying, rather than creating, shareholder value.
Indeed, in our own research at CEB, we’ve found that only one third of mergers and acquisitions are clear successes. Yet Nadella and LinkedIn CEO Jeff Weiner, who is staying on to lead LinkedIn through its integration into Microsoft, appear to recognize those pitfalls, and that’s why, as they told Wingfield in a joint interview before the deal closed, they’re trying to do things differently:
A key difference in the way Microsoft has approached the deal is the degree of independence it plans to give LinkedIn. It will not weave LinkedIn, which is based in Silicon Valley, into one of its existing product lines, nor will it treat it like a disconnected business. Mr. Weiner will remain LinkedIn’s chief executive. …
A good model inside Microsoft is the company’s $2.5 billion purchase in 2014 of Mojang, the developer behind Minecraft, which has continued to grow under Microsoft’s ownership, retaining key employees along the way. Mr. Nadella and Mr. Weiner said they had also looked to Facebook’s success in acquiring companies like the photo-sharing service Instagram, while granting them autonomy. “I absolutely think of LinkedIn as our Instagram,” Mr. Nadella said.
For all our coverage of the Microsoft/LinkedIn acquisition, head here.