Microsoft is buying LinkedIn for a whopping $26.2 billion. Both companies are hyping the angle of combining the “world's leading professional cloud with the world's leading professional network.”
In Microsoft CEO Satya Nadella’s memo to employees, he wrote:
This deal is key to our bold ambition to reinvent productivity and business processes. Think about it: How people find jobs, build skills, sell, market and get work done and ultimately find success requires a connected professional world. It requires a vibrant network that brings together a professional’s information in LinkedIn’s public network with the information in Office 365 and Dynamics. This combination will make it possible for new experiences such as a LinkedIn newsfeed that serves up articles based on the project you are working on and Office suggesting an expert to connect with via LinkedIn to help with a task you’re trying to complete. As these experiences get more intelligent and delightful, the LinkedIn and Office 365 engagement will grow. And in turn, new opportunities will be created for monetization through individual and organization subscriptions and targeted advertising.
“Our companies are the world’s leading professional cloud and network,” said LinkedIn CEO Jeff Weiner. He will report to Nadella but remain CEO of LinkedIn. “The LinkedIn you know and value is only getting better. LinkedIn will retain its distinct brand, culture and independence. We’ve been changing the way the world’s professionals have connected to opportunity for 13 years, and this is an opportunity for us to truly change the way the world works on a massive scale.”
Microsoft and LinkedIn merger presents data privacy risks
But what does the acquisition, the merger of the “world's leading professional cloud with the world's leading professional network,” mean from a privacy and data perspective? Dimitri Sirota, CEO of BigID, warned that LinkedIn has a “deep insight into the majority of professionals in terms of relationships, interests, satisfaction with their work, intentions to leave their work” and so on. Those insights will now be available to Microsoft. “Mergers complicate how personal data is shared across franchises.”
He warned there are potential privacy and confidentiality risks associated with integrating personal profile information, user data, across formerly separate entities.
“These businesses will suddenly have new personal data it can leverage, begging questions around controls,” Sirota said.
While explaining what Microsoft considers when looking at potential acquisitions, Nadella gave Business Insider an example scenario that included “walking into a meeting and getting a snapshot of each person in the meeting based on their LinkedIn profile.”
In the email to Microsoft employees, Nadella added, “This deal is the next step forward for Office 365 and Dynamics as they connect to the world’s largest and most valuable professional network. In essence, we can reinvent ways to make professionals more productive while at the same time reinventing selling, marketing and talent management business processes. I can’t wait to see what our teams dream up when we can begin working together once the deal closes, which we expect will happen this calendar year.”
Although both companies’ boards unanimously approved the deal, the acquisition is still subject to approval by LinkedIn shareholders and regulators in the “United States, the EU, Canada and Brazil.”
Hopefully at least one regulator in one country, perhaps the EU since it has stronger data privacy laws, will ask the hard questions from a privacy and data protection perspective.