Microsoft-LinkedIn Deal: What's the Channel Angle?
Why is Microsoft's planning to buy LinkedIn for $26.2 billion? At first glance, it seems like a very expensive way for Microsoft to become relevant in the CRM space, particularly since Salesforce has been investing heavily in advanced analytics technologies that ultimately serve to unify the sales and marketing motions.
Microsoft has yet to address the marketing-automation functionality that is now increasingly being embedded into the Salesforce cloud. However, the acquisition of LinkedIn just might bring Microsoft something more valuable: LinkedIn owns one of the largest business-to-business databases of names in the world.
Not only will Microsoft undoubtedly try to embed that data inside its CRM and productivity applications, but it won't be long before all the data starts getting crunched within various data analytics services that the company is constructing on top of the Azure platform. It's conceivable that in the future Microsoft will know with a high degree of confidence not only what IT products anyone inside an organization is starting to express an interest in, but also every type and class of product or service offered within any vertical industry segment.
As a result, Microsoft partners need to take a much wider view of what the company's end game in the cloud really is.
One thing that LinkedIn does better than Microsoft in the cloud is that its sales and marketing efforts are squarely focused on providing a specific business outcome, said Christopher Woodin, director of Microsoft sales operations for Softchoice, a channel partner.
For that reason, IT solution providers across the channel are going to have rethink their relationships with end customers, starting with providing managed services around Microsoft Office 365, Woodin said. End customers are no longer looking for IT services companies to help them deploy technologies. Instead, end customers will be judging the value a Microsoft partner provides them in terms of the number of cloud services features they help them fully exploit, Woodin said.
Fundamentally, that means IT solution providers will need to have a much deeper understanding of the processes and workflows that drive any organization they serve. As the way organizations consume IT continues to evolve, a subtle change in how solution providers are perceived and valued is expected to drive a channel transformation that will bring about a new wave of mergers and acquisitions.
There's no doubt that LinkedIn has the potential to provide Microsoft with a recurring return on that investment for years to come. In the near term, most of that ROI will be most visible in terms of making Microsoft applications more useful.
However, in terms of the company that Microsoft aspires to be under the leadership of CEO Satya Nadella, the data it gains by acquiring LinkedIn may very well be priceless.
Michael Vizard has been covering IT issues in the enterprise for more than 25 years as an editor and columnist for publications such as InfoWorld, eWEEK, Baseline, CRN, ComputerWorld and Digital Review.