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Enterprise 2.0 Gets a Fillip

Microsoft-Yammer, Oracle-Vitrue, Salesforce-Buddy Media

So Microsoft has spent USD 1.2 billion to buy Yammer.

Few days back Salesforce acquired Buddy Media for USD 0.689 billion and about a month back Oracle acquired Vitrue for about USD 0.3 billion.

That makes the Microsoft acquisition of Yammer the 3rd social media startup acquisition in last one month and a total spending of around USD 2.2 billion.

So is this a trend of Enterprise software players moving into Social Media space?

Incidentally, about a year back Microsoft had paid USD 8.5 billion for the Skype.

Technology that businesses need and people love
That is what Steve Ballmer said when he made the announcement. He also said that “Think of Yammer as a fundamental part of our Office family”.

Which means in future you can expect Yammer to be more tightly integrated with SharePoint, Office365, Dynamics and Skype. As a Yammer user, I am not sure if this is good news or bad news as our Yammer usage has grown organically.

Here is some statistics about Yammer:

  • Founded in: 2008
  • Current user base: 5 million
  • Paid customers: approximately 20%
  • Enterprise penetration: Users in 85% of Fortune 500 and around 0.2 million companies
  • VC funding raised so far: USD 142 million
  • Acquisition value per user: 3X compared to Facebook

IDC expects a compound annual spending growth in excess of 40% in Enterprise 2.0

Between 2011 and 2016, IDC expects the compound annual growth rate in spending to hit 42.4% for Enterprise 2.0 products and services. Customers spent USD 0.77 million on the products globally in 2011, and will spend almost USD 4.5 billion in 2016, according to IDC’s “Worldwide Enterprise Social Software 2012-2016 Forecast.”

IDC also lists out top 10 Enterprise 2.0 vendors:

  1. IBM (USD 105.4 million)
  2. Jive Software (USD 65.3 million)
  3. Communispace (USD 60 million)
  4. Telligent (USD 42.7 million)
  5. Socialtext (USD 34.5 million)
  6. Mzinga
  7. Lithium
  8. Yammer
  9. NewsGator
  10. VMware

Google also may be working on a workplace version of Google+.

However…

There is a large gap between management and employees regarding usefulness of Enterprise 2.0. According to a recent survey commissioned by Deloitte, there is a difference in opinion between executive-level leaders and employees when it comes to how they perceive usefulness of social media.

There is a large gap between what management thinks and what employees perceive.

  • 45% of executives say social media has a positive impact on workplace culture while only 27% employees agree.
  • 41% of executives compared with only 21% of employees believe that social networking helps to build and maintain workplace culture.
  • As it relates to management visibility, 38% of executives think social media allows for increased transparency while only 17% of employees agree.

Why this disconnect? Is Enterprise 2.0 a solution in search of a problem?

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More Stories By Udayan Banerjee

Udayan Banerjee is CTO at NIIT Technologies Ltd, an IT industry veteran with more than 30 years' experience. He blogs at http://setandbma.wordpress.com.
The blog focuses on emerging technologies like cloud computing, mobile computing, social media aka web 2.0 etc. It also contains stuff about agile methodology and trends in architecture. It is a world view seen through the lens of a software service provider based out of Bangalore and serving clients across the world. The focus is mostly on...

  • Keep the hype out and project a realistic picture
  • Uncover trends not very apparent
  • Draw conclusion from real life experience
  • Point out fallacy & discrepancy when I see them
  • Talk about trends which I find interesting
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