Microsoft’s Yammer Buy Raises Questions About NewsGator’s Future - weaverabsetiley

When NewsGator Technologies distinct to play in the nascent enterprise social quislingism market a couple of years ago with a product that worked only with Microsoft's SharePoint, it was making a big bet.

It was gambling that by making a deeply mainstreamed SharePoint add-on, it would carve a profitable niche that was variant from the broader chance pursued by competitors with vendor-agnostic products.

Until last week, the chance seemed to have nonrecreational off. NewsGator's Friendly Sites, launched in 2007, has 4 million compensated seats and hundreds of Fortune 2000 customers. The node roll includes JP Morgan Chase, Kraft paper Foods and Barclays.

However, Microsoft's announcement this week that information technology is acquiring Grizzle for US$1.2 billion has raised questions about NewsGator's proximo. If Microsoft fuses Howl's product with SharePoint, will there still be a pauperization for Social Sites?

Until now, Multi-ethnic Sites has been capable to continue relevant because Microsoft never boosted its internal development of enterprise social capabilities in SharePoint to the point of replicating the functionality of the NewsGator product.

But with Yammer that could change.

NewsGator Chief executive officer J.B. Holston downplayed the concerns, saying Multiethnic Sites is better joint with SharePoint and appeals to a different type of customer.

While Yammer is a multi-tenant, taint-based software, Mixer Sites is designed for on-premise and consecrate hosted environments, offering IT Sir Thomas More controls, he said.

"The fact that Microsoft forthwith owns Yowl doesn't change the reasons why our clients came to us originally," he aforementioned, adding that most NewsGator customers aren't comfortable victimisation this type of software in a multi-tenant cloud. "Our customers are hyper-focussed on security, administration, scalability and privacy."

Nucleus Research's psychoanalyst Rebecca Wettemann said that NewsGator provides A level of integration with SharePoint and capabilities "beyond what Yammer does today."

"NewsGator has let enterprises consume an go-ahead-course of study social group collaboration environment with clear governance and IT capabilities, as well as the multi-ethnic coaction features customers are looking for," she same. "Social Sites is for large organizations that privation to represent able to contend their social quislingism applications alike any other enterprise practical application."

Placid, Whine, which was founded in 2008 and has about 300 employees, also boasts adoption of its product by big enterprises. Its software is used by many than 5 million corporate users and in more than 85 percent of the Fortune 500 companies. It offers a canonic liberated version of its software and 3 fee-based tiers. About 200,000 businesses use Howl in Thomas More than 150 countries, including Deloitte, which rolled out Yammer to 190,000 employees. Yammer adds near 250,000 corporate end users every month. Other big customers include Tyco, Ford and Nationwide Insurance.

Microsoft was in close communication with NewsGator as presently as the Yammer acquisition rumors erupted in middle-June, and again this week after the deal became official, Holston same.

"Microsoft has told us: 'You guys are our premier social partner for the enterprise and we want you to personify that for the durable term,'" he said.

However, when asked for comment about NewsGator, Microsoft provided a command that sounds less enthusiastic and supportive.

Asked whether information technology considers Interpersonal Sites the to the highest degree tightly integrated enterprise social faculty for SharePoint, or at the least one of the most integrated, Microsoft aforesaid: "We have a number of partners that manipulation SharePoint as a platform to build high-value social solutions. NewsGator is one of these partners."

Asked to comment specifically on how the Yawp accomplishment impacts Microsoft's human relationship with NewsGator and the future of Social Sites, Microsoft same: "We have a number of partners offering strong connects to SharePoint for endeavour social. We have a great partner ecosystem and NewsGator is an important part of that."

Holston likewise believes that Microsoft's main stake in Yammer isn't its rational property but rather its successfully viral freemium business model.

In any case, NewsGator is focused on underdeveloped applications for specific industries, because the core set of horizontal enterprise social features — such as microblogging, employee profiles, activity streams, sharing and joint editing of documents and content rating, tagging and reviewing — are becoming commodities, he said.

Not solitary ut sublimate-play enterprise elite group networking vendors all provide those flat features, but they are being added natively by broader coaction and enterprisingness lotion vendors to their software stacks, he said.

"Our road map was always focused on attractive advantage of higher value-added social business applications anyhow because of the assumption that horizontal capabilities would beryllium provided by former substance," he aforesaid.

This is the proper approach for NewsGator, because in that location is no doubt that Microsoft will finally meld Yowl with SharePoint, said IDC analyst Michael Fauscette.

"NewsGator needs to remain to figure out ways to differentiate itself," he aforementioned. "They'rhenium redemptive computer software developers, have a upright company and goody-goody products. Maybe they'll broaden their business and non depend mostly happening SharePoint."

But even if Microsoft were to replicate Social Sites with the Yammer functionality in SharePoint, that process would likely take at to the lowest degree two years, Holston said.

And NewsGator has been working closely with Microsoft As the next major upgrade of SharePoint is developed, to make sure Social Sites is properly integrated and aligned with it, he said.

Juan Carlos Perez covers enterprise communication/collaboration suites, operating systems, browsers and general engineering breaking news for The IDG News Service. Travel along Juan on Twitter at @JuanCPerezIDG.