Insights: What lead to the Definitive Agreement between $MSFT and $LNKD?

LinkedIn is the world’s largest and most valuable professional network and continues to build a strong and growing business. Over the past year, the company has launched a new version of its mobile app that has led to increased member engagement; enhanced the LinkedIn Newsfeed to deliver better business insights; acquired a leading online learning platform called Lynda.com to enter a new market; and rolled out a new version of its Recruiter product to its enterprise customers. These innovations have resulted in increased membership, engagement and financial results, specifically:

• 19% growth year over year to more than 433 million members worldwide
• 9% growth year-on-year to more than 105 million unique visiting members per month
• 49% growth year-on-year to 60 percent mobile usage
• 34% growth year-on-year to more than 45 billion quarterly member page views
• 101% growth year-on-year to more than 7 million active job listings

“The LinkedIn team has grown a fantastic business centered on connecting the world’s professionals,” Satya Nadella said. “Together we can accelerate the growth of LinkedIn, as well as Microsoft Office 365 and Dynamics as we seek to empower every person and organization on the planet.”

Microsoft Corp. (MSFT) and LinkedIn Corporation (LNKD) on Monday announced they have entered into a definitive agreement under which Microsoft will acquire LinkedIn for $196 per share in an all-cash transaction valued at $26.2 billion, inclusive of LinkedIn’s net cash.

LinkedIn will retain its distinct brand, culture and independence. Jeff Weiner will remain CEO of LinkedIn, reporting to Satya Nadella, CEO of Microsoft. Reid Hoffman, chairman of the board, co-founder and controlling shareholder of LinkedIn, and Weiner both fully support this transaction. The transaction is expected to close this calendar year.

Mark Zuckerberg on Facebook Q4 2015

"100 million hours of video are watched daily on Facebook."

• More than 1.59 billion people now use Facebook each month and 1.04 billion every day, a growth of nearly 200 million people monthly and a 148 million people daily.
• More than 1.44 billion people use Facebook on mobile devices.
• More than 950 million people received a notification that a friend or a loved one was safe in a crisis.
• More than 8 million people used 35,000 Groups and Pages on Facebook to support refugees.
• As of February 2016, 100 million hours of video are watched daily on Facebook.
• More than 500 million people use events each month and more than a 123 million events were created on Facebook in 2015.
• More than 80 million people now use Facebook Lite as of December.
• There are 2.5 million active Advertisers.
• More than 50 million small businesses now use Pages on Facebook and people post more than 2.5 billion comments on these Pages each month.
• In September 2015, Instagram announced a new milestone of 400 million monthly actives.
• WhatsApp ended the year 2015 with nearly 1 billion monthly actives.

Jack Dorsey's Five Priorities in 2016 for Twitter

"Twitter has always been considered a second screen for what’s happening in the world. And we believe we can become the first screen for everything that’s happening right now."

 - Jack Dorsey 

 Five priorities in 2016 to serve this focus are as follows:

• Refine core service and make everything more intuitive.
• Invest in being a leader in live streaming video, filming off their lead with Periscope.
• Give creators and influencers, the best tools to build and connect with audiences.
• Invest in making Twitter safer, so everyone can feel more empowered to speak freely.
• Support developers to build and grow their businesses with Twitter. Each is critical to strengthening the platform and audience around Live.

Oracle’s Cloud SaaS and PaaS revenue is still second to Salesforce.com

In FY’16, Oracle plans on selling between $1.5 billion and $2 billion of new SaaS and PaaS business. In other words, the company plans to sell at least twice as much as they sold last year. And that’s at least 50% more new business than Salesforce.com will sell in their current fiscal year. And if Oracle exceeds their plan like they did this Q4, they could book twice as much new business as Saleforce.com.

Larry Ellison, Executive Chairman and CTO said, ‘Now I don’t think that’s likely that we will sell double than what Saleforce.com sells, but it’s definitely possible’. Oracle’s Cloud SaaS and PaaS revenue is still second to Salesforce.com but the management strongly believes that they are growing at a much faster rate than Salesforce.com.

Microsoft aims at reaching 1 billion Windows 10 active devices by fiscal year 2018

Microsoft’s bold ambition is to create more personal computing experiences with Windows and their devices. It's the first step towards their goal of 1 billion Windows 10 active devices in the fiscal year 2018.

The company’s aspiration with Windows 10 is to move people from meeting to choosing to loving Windows. Based on feedback from more than 5 million people who have been using Windows 10, Microsoft believes people will love the familiarity of Windows 10 and the innovation. It's safe, secure, and always up to date.

Windows 10 is more personal and more productive with Cortana, Office, and Continuum. And Windows 10 will deliver innovative new experiences like Inking on Microsoft Edge and gaming across Xbox and PCs, and also opens up entirely new device categories such as HoloLens.

Windows 10 will deliver significant value to enterprise customers as well. Windows 10 provides advanced security capabilities with additional features for hardware-based security, mobile work and data protection. It also provides a single device management platform across all devices, from phones to laptops to Internet of Things devices. And Windows 10 helps enterprises stay up to date with Windows Update for Business and Windows Store for Business.

Twitter has begun the process of hiring a CMO.

As of Q2 2015, Twitter had over 95% brand awareness across the most important global markets. Despite this enormous awareness, Twitter managed to achieve less than 30% penetration of users in these markets. This low level of penetration implies that Twitter has only reached early adopters and technology enthusiasts and has not yet reached the next cohort of users known as the mass market.

The management believes they have failed to do two critical things; firstly, they have not yet clearly communicated Twitter’s unique value and so that’s reflected in everything they do across product, content and marketing, and as a result, non-users can ask Why Should I Use Twitter?

Additionally, the company has not delivered on meeting the new potential user’s expectations of Twitter when they try the product. Simply said, the product remains too difficult to use. Jack Dorsey, Interim CEO believes that they need to simplify the product so everyone gets value from Twitter faster.

In short, the company has not yet communicated, ‘Why Should People Use Twitter?’ nor made it easy for them to understand, ‘How to Use Twitter?’ This is both a product issue and a marketing issue.

You Should Also Read: So What Should You Expect From Twitter?

A lot of other products in the past have overcome these same issues and have successfully made their transition to reach the mass market adoption phase and the management seems confident they can do the same.

The management is working as rapidly as they can to put Twitter in a position to launch an integrated marketing strategy and marketing campaign before the end of 2015.

Anthony Noto, Chief Financial Officer said, ‘We have begun the process of hiring a CMO and are encouraged by the quality of candidates that we are in dialogue with’.

G is for Google

“Google is not a conventional company. We do not intend to become one.” – Larry Page

What is Alphabet Inc.?

Alphabet is a collection of companies, with Google being the large part of it. Goggle has slimmed down a bit, with the companies that are pretty far afield of their main internet products will now be contained in Alphabet instead.

Larry Page further explains about what is far afield? Good examples are health efforts: Life Sciences that works on the glucose-sensing contact lens and Calico focused on longevity. Alphabet is about businesses prospering through strong leaders and independence. In general, the model is to have a strong CEO who runs each business, with Larry Page and Sergey Brin in service to them as needed.

The Founders have always been of the view point to make smaller bets in areas that might seem very speculative or even strange when compared to the current businesses. From the start, they’ve always striven to do more, and to do important and meaningful things with the resources at their disposal.

The company is operating well today, but the Founders think that they can make it cleaner and more accountable. Hence creating a new company called Alphabet. Larry Page will be running the company as CEO with help from his capable partner, Sergey Brin as President.