Is Microsoft About To Buy Social Network Yammer?

Rumors from the company suggest MSFT could buy social network Yammer

Microsoft could be purchasing Yammer, as early as tomorrow, according to reports of overheard conversations

Business Insider heard from a source inside Yammer that there’s an imminent Microsoft buyout, and the company’s office has been talking about the news since Monday this week. The site reported on conversations heard outside the office, from people at a cafe just across from Yammer’s office, with rumors the buyout could happen tomorrow.

Yammer is web-based, and allows users to collaborate on projects on what Business Insider described as more Facebook than Microsoft Office. It seems a bit of a curveball in terms of how Microsoft will integrate the software, but in 2010 Yammer did integrate with Microsoft SharePoint and has supported third-party apps. Perhaps Microsoft is thinking of launching a Google Docs rival that’s integrated into its software.

Yammer reportedly raised around $85 million in February at a valuation of around $500 million, so look for that figure whenever Microsoft decides to complete the buyout. It’s actually pretty cheap, and could prove to be another smart move by Microsoft. That’s what I think, at least, though Business Insider says it could be much more – even double. A $1 billion buyout? Sounds like a lot, but in the grand scale I doubt it is.

A Billion Dollars Or More, As Soon As Friday

Bloomberg since reported that the $1 billion valuation is indeed real, and could go through as early as tomorrow. Spokespersons for Yammer and Microsoft didn’t comment, unsurprisingly. Yammer began in 2008 and is now used by more than 200,000 companies. Integrating the software into Windows 8 could be another carrot for enterprise who are, I think it’s safe to say, not entirely sold on Windows 8. Bare in mind Windows XP has been used for over a decade.

Bloomberg described Yammer as a corporate Facebook, and was founded by David Sacks – once chief operating officer at PayPal. The company has raised over $140 million in funding, so it certainly looks marketable from Microsoft and it has the pedigree to raise further money.

It’s possibly Microsoft could use the service to launch a Google Docs rival, and it may happen, but it’s likely this will remain an internal service for Microsoft employees’ eyes only.