We all took a collective gasp when we saw the price tag of Microsoft’s acquisition of LinkedIn. Now that the dust has settled a bit, we can pause and reflect on what this means from a data, privacy and email perspective — given that all three are potential strengths, weaknesses and concerns arising from the merger of two giants.
While at a conference recently, I sat down with my colleague and friend, Dennis Dayman, chief privacy officer at Return Path, and discussed how this deal could change the B2B data landscape. Here’s what he had to say.
Len Shneyder: What did you make of this deal when you saw the announcement?
Dennis Dayman: At first I wasn’t sure what their plans were outside of an existing partnership. The more I thought about it, the more I began to realize Microsoft, like Google and other enterprises, really lacks a real social media presence or product. On the other hand, LinkedIn is a company that doesn’t make operating systems or business software, yet they’re at the forefront of enabling the people who do. So then what are the competitive advantages for these two behemoths joining forces? Why would Microsoft want LinkedIn, and how would they use it as a competitive advantage against Apple?
LS: Is that a rhetorical question? At $26 billion, the acquisition is much more than a checkbox. Apple doesn’t have a social platform per se, but some may perceive them as a social enabler: The App marketplace is a kind of social landscape, music is a socially engaging medium, as are movies — these are culturally significant and drive social engagements. But I think I see what you’re saying.
DD: Right now, Google has lots of data on users of their Google Apps product line for B2B clients and Google doesn’t sell or share that out to anyone; on the flip side, we know that Microsoft has lots of data on users in their Office 365 product line… it’s an interesting parallel when you think about it.
LS: Very true, I hadn’t thought of it that way. So what’s in it for Microsoft? Does this help them go toe-to-toe with the social giants or the operating system platforms?
DD: I think it’s more about Microsoft wanting to know you, the B2B user, and how you engage with business productivity tools. Additionally, the connections you make and maintain in the world serve as a kind of social launching pad for the products and platforms you use on a daily basis. From the content side, who you are talking to, and what you are talking about are equally important. Having all that information positions Microsoft better in today’s competitive B2B computer market, B2B collaboration, B2B operating systems market and the hottest market of them all: cloud computing.
LS: So at the end of the day, data is king, it’s always what’s most important and LinkedIn represents a kind of B2B social intelligence that Microsoft only had in the form of usage data through Outlook 365. They knew how people worked with their products, but they didn’t know what they were saying about their products and what those conversations meant in light of their products.
DD: Absolutely! This brings them up to par with Google. Google’s products are free, their email service is free and free is always awesome in my book. Google’s cloud already has an expansive network of users.
LS: How does Google’s cloud stack up against Azure? Or does this even matter?
DD: I’m less interested and concerned about the direct cloud-to-cloud comparison of Azure versus Google. What we have to realize is that the merger gives Microsoft access to a plethora of already involved users with lots of “cloud” data and the ability for those B2B users to easily share their Office 365 work product with many others outside of their company’s user base. It gives Microsoft the ability to know who you might be working with, partnering with or just plain sharing data with.