New Acquisition Pressures Newsgator

August 14, 2012

A recent Microsoft move may be bad news for NewsGator, ComputerWorld reveals in “Microsoft’s Yammer Buy Raises Questions About NewsGator’s Future.” Yammer and NewsGator are competitors in the SharePoint enterprise social add-on market. Does Microsoft’s acquisition of one spell trouble for the other?

Social Sites is the name of NewsGator’s SharePoint add-on. Since it launched in 2007, it has accumulated an impressive roster of clients. If Microsoft integrates the similarly successful Yammer into SharePoint, that could change. NewsGator CEO J.B. Holston remains optimistic, though, insisting that the two products attract different types of customers. Writer Juan Carlos Perez explains:

“While Yammer is a multi-tenant, cloud-based software, Social Sites is designed for on-premise and dedicated hosted environments, offering IT more controls, [Holston] said.

“‘The fact that Microsoft now owns Yammer doesn’t change the reasons why our clients came to us originally,’ he said, adding that most NewsGator customers aren’t comfortable using this type of software in a multi-tenant cloud. ‘Our customers are hyper-focused on security, governance, scalability and privacy.'”

Not only that, but NewsGator stands out as a developer of applications for specific industries. Will these unique qualities be enough to protect the company? We won’t know for a while, Perez says, since it would take a couple of years for Microsoft to mimic Social Sites with Yammer functionality. If it even chooses to do so at all; Holston thinks Microsoft only loves Yammer for its successful “freemium” business model. Hey, he can hope.

Founded in 2004 and headquartered in Denver, Colorado, NewsGator proclaims a passion for customer satisfaction. The company asserts that they are (so far, I’d add) the social software vendor most deeply integrated into the Microsoft stack.

Yammer launched in 2008, and seems to be very proud to be joining the Microsoft universe. They assert that, with former Facebook innovators on their team, their social products have the advantage of “Facebook DNA.” Interesting.

Cynthia Murrell, August 14, 2012

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