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2018-06-28 09:31:53
Satya Nadella, the software giant s boss, sees huge value in GitHub s social
graph for developers
Jun 9th 2018
ALMOST to the day 17 years ago Steve Ballmer, then boss of Microsoft, the world
s biggest software firm, called Linux a cancer , meaning that the open-source
operating system would spell the death of proprietary software. On June 4th,
his successor, Satya Nadella, announced that the firm would take over GitHub,
the main source of such tumours today, for $7.5bn. The deal is yet another sign
of Microsoft s startling recent metamorphosis.
GitHub is no household name, but among programmers it is as important as
Facebook which explains the impressive price tag for a firm that earned only an
estimated $200m of revenues last year. More than 28m developers globally keep
their code on the website, which offers all kinds of tools and services. Most
important of these is allowing software projects, whether open-source or not,
easily to pull together code from different contributors.
For Microsoft the deal is a homecoming. It used to be a kind of GitHub itself.
When Windows, its flagship operating system, ruled computing in the 1990s,
developers flocked to it. But the firm lost its role as the main hub for
programmers when it got a late start on the internet, fought open-source and
missed mobile computing. Microsoft kept pushing Windows everywhere though the
world had moved on. This only changed when Mr Nadella took the helm in 2014. He
has re-established Microsoft as a firm of platforms, but on a higher level. One
such is cloud computing, where it is now a strong number two behind Amazon.
LinkedIn, which Microsoft took over in 2016, is another. The social network
provided it with access to the range of connections between professionals (the
social graph in geek) and lots of data. GitHub has to be seen in the same
light. Microsoft already uses the service for much of its own software and
developers may now be more inclined to write software for the firm s cloud,
Azure.
Although Microsoft has promised that GitHub will stay independent and maintain
its status as an open platform, many developers, an opinionated group, are not
amused. They still see Microsoft as the Death Star space station in the Star
Wars films that kills everything in its sight. But they have got it the wrong
way around. The deal is final proof that the rebel forces have won. In most big
software markets, open source is now the default.
The deal has given Microsoft a push in the race among tech giants to become the
first company worth $1trn. Its share price jumped by 1% on the news investors
believe in Mr Nadella s rationale. In late May its market capitalisation had
already briefly passed that of Alphabet, Google s parent. The winner on current
trends will most likely be Apple, but Microsoft and Amazon are now at the same
level not bad for a firm that by tech-industry standards is as old as the
hills.