Just last night, Bloomberg broke the news that Microsoft was buying coding platform GitHub. The formal declaration is expected later today though. According to the report, “GitHub preferred selling the company to going public and chose Microsoft partially because it was impressed by Nadella, said one of the people, who asked not to be identified discussing private information. Terms of the agreement weren’t known on Sunday. GitHub was last valued at $2 billion in 2015.”
That said, it is also reported that developers did not take the news well as some have threatened to switch to a rival, GitLab. As much as the developers may not be happy with the deal which could mean integration of more Microsoft tools and platforms but be that as it may, Microsoft is the biggest software maker in the world and it only makes sense that it would be one to acquire it.
Azure is the certainly the big price here for Microsoft which will further bring the compete ion to AWS. By acquiring the biggest developer platform too, it’s a big PR move over AWS (which still controls the public cloud space). Microsoft will use the opportunity to promote its enterprise services into applications in a faster way by making it easier for developers to do so. So imagine how much developers can do with Microsoft’s digital assistant Cortana and its other AR platforms.
It actually makes sense for them to be bought over and as Bloomberg puts it, Many corporations, including Microsoft and Alphabet Inc.’s Google, use it to store their corporate code and to collaborate. It’s also a social network of sorts for developers. Still, GitHub’s losses have been significant — it lost $66 million over three quarters in 2016 — and it has been hunting for a new CEO for nine months. The company had revenue of $98 million in nine months of 2016
As for the San Francisco based GitHub, it won’t have to bear the burden of answering directly to investors because it would simply be under the Microsoft umbrella. It may have been a different story for developers should they have gone the IPO route.