A few weeks ago, the news broke out that Microsoft had made a deal to buy Linkedin. Now the question is: will this have consequences for the job boards?
It’s a fact that when one of the top 10 companies in the world buys a business that can be your potential competitor: that can be bad news. But let’s analyze in more detail this operation…
Microsoft payed 26.200 million dollars in cash. This means 60$ per registered user. In my opinion, it’s a very high price. Especially because only one out of every four members is really active in the professional social media site and visits their profile every month. We have to remember that Facebook bought Whatsapp and Instagram for 30$/registered user…
Synergies between Microsoft and Linkedin
If we think of the benefits, the value Linkedin provides Microsoft is quite clear. The technological giant now owns a database of 420 million users and that, of course, gives them a lot of opportunities for the sales of their products. The principal value of this professional network is the enormous amount of data they possess.
What is more difficult to imagine is how Microsoft can add value to Linkedin. Basically, Linkedin functions as a networking tool and Microsoft is more orientated towards companies. I think that The Cloud Azure technology in itself will not be very useful. Data has value if it’s being used not when it’s only being accumulated. Maybe the combination of Bing with Linkedin could be a problem for Google or maybe Skype can be useful for Linkedin users.
Microsoft should keep Linkedin separate
If Microsoft wants to be successful with this acquisition it should keep Linkedin totally separate from their actual business. Remember what happened when Rupert Murdoch’s News Corp bought Myspace in 2005 for 580 million dollars. In 2011 he sold it for only 35 million. So, I think, when something works, don’t touch it.
¿Facebook, Google or Microsoft?
It’s obvious that Linkedin and job boards possess privileged information about the users. Big corporations have more and more interest in this data. That’s why some time ago there were rumors about a possible sale of Linkedin to Facebook, Google or Microsoft. Actually, these days it came to light that Microsoft wasn’t the only interested party in buying Linkedin. Google and Salesforce also tried to buy it. Salesforce offered 200 dollars per share and some cash. This made Microsoft raise their offer to 196 dollars per share, all in cash. This was a 22% increase above their initial offer.
Finally, Linkedin sold to Microsoft. If we consider that Google might have been the buyer, maybe Microsoft is the less dangerous option for job board.
Although, as I said at the beginning, we shouldn’t forget that the Company founded by Bill Gates is one of the most valuable 10 companies on the planet and it’s worth 3.745 million dollars in cash. We will have to wait and see what decisions are made to evaluate the potential threat for job boards.