What Microsoft’s Acquisition of LinkedIn Could Mean for Publishers
Yesterday Microsoft made online media waves with the proposed acquisition of LinkedIn. The software provider intends to purchase LinkedIn at $196 per share, a transaction valued at $26.2 billion. It would be the most expensive acquisition Microsoft has ever made. While the deal won’t officially close until later in 2016, many pundits are already discussing the potential impact on both companies and what the acquisition would mean for other industries, like publishing.
What’s in it for Microsoft? Two recurring themes emerged in both the press release published on Monday and the resulting media coverage -- data and cloud computing. Microsoft is looking to transition from being solely known as a software and hardware provider for business professionals to a tech business, perhaps one day rivaling the cloud computing chops of Amazon or Google. It also wants access to LinkedIn user data to enhance its current product mix, integrating LinkedIn profiles with its digital assistant Cortana and connecting LinkedIn Learning courses to Office 365, for example. The data of LinkedIn’s 433 million users will also likely inform Microsoft’s future product development.
This integration will create new opportunities and challenges for publishers.
Publisher Might See Better Content Distribution
TechCrunch’s Sarah Perez writes that LinkedIn and Microsoft’s integration could lead to more user-friendly content experiences. According to an email sent from Microsoft CEO Satya Nadella to employees, the acquisition could lead to experiences like “a LinkedIn newsfeed that serves up articles based on the project you are working on [in Microsoft Office]”. These types of content recommendations could help publishers reach more targeted and engaged audiences within the 1.2 billion professionals that use Office today. That type of reach is something many publishers will be unable to pass up.
Still, and as is the case with Facebook Instant Articles, there are concerns that distributing content on platforms like LinkedIn is at odds with publishers’ need to build direct relationships with and monetize their audiences. While distributed content provides valuable audience development and traffic growth opportunities, publishers are concerned that LinkedIn is reaping far more value from the relationship (in the form of quality content that fuels user engagement) than publishers. Either way, publishers will need to find a healthy balance of how much they distribute on LinkedIn and find creative ways to drive LinkedIn users back to their site.
LinkedIn Publishing’s Arm Will Expand
It’s also important to remember that LinkedIn is a major publisher in it’s own right. Some, like Forbes contributor Grant Feller, observe that the Microsoft acquisition is all about content. Microsoft effectively purchased one of the largest and most influential, business-minded digital media companies in the world. Feller writes that LinkedIn is the platform for business people to build their personal brand, their networks, and maneuver toward better job opportunities through the content they create. He anticipates that Microsoft will be expanding this publishing mission and may even monetize LinkedIn content by charging for access.
Becoming a destination for content consumption has been a part of the social platform’s strategy since it’s acquisitions of newsfeed Pulse in 2013 and learning platform Lynda.com in 2015. This means even more competition for publishers, particularly in the B2B space. Publishers will need to identify smart ways to serve their specific audiences in a way that a massive professional network like LinkedIn cannot.
Of course it all circles back to the data. LinkedIn wouldn’t be interested in content creation and distribution if it didn’t fuel user engagement, which yields more data. As ZDNet reports:
“Microsoft's graph is a collection of information pertaining to entities like contacts, messages, calendar entries and documents. LinkedIn's graph centers around entity information regarding jobs, coworkers, learning, prospects and recruiting/hiring.”
Target Marketing’s Heather Fletcher suggested thinking of the acquisition of LinkedIn, with 433 million members worldwide, as a giant email append. Of course, that bounty of data is fuel for cross-platform, highly-targeted marketing efforts, such as paid search, display ads, and native content. Imagine the plethora of data points Microsoft could pull from -- Outlook, Calendar, Active Directory, Office, Windows, Skype, Dynamics, Cortana, Bing and more – to target business professionals. However, time will tell whether Microsoft is more interested in using LinkedIn to drive marketing and advertising revenue or to add value and greater integration to its core businesses, cloud and hardware products. Publishers should hope for the later.