Today another headline has captured the minds of many in open source as it seems that yet another open source centric company has been acquired by a private one. Only a couple weeks ago we heard the announcement of Adobe acquiring Magento, arguably the biggest open source e-commerce platform. My good friend Dries wrote a great piece on the purchase so I don’t feel it’s necessary to rehash it too much. If you’re interested you should absolutely read his post: My thoughts on Adobe buying Magento for $1.68 billion | Dries Buytaert. And now, this last weekend the big news appears to be the announcement that Microsoft is acquiring GitHub for $7.5 billion.
Woah, but I thought Microsoft was the enemy
Perhaps one of the most talked about part of this news is Microsoft’s previous statements about open source (particularly Linux). I thought long and hard about this as well as considering my own opinions and inclinations towards Microsoft in this regards. I knew of this deep-seated animosity and dislike for Linux and simply assumed this belief continued deep within the Redmond walls — and in spite of any outward overtures of support, and dare I say “love”.
I thought about Satya Nadella and the work he’s been advocating so heavily for at Microsoft since he stepped in as CEO. And I reflected back on the book, Hit Refresh, his autobiography. This caused me to pick it back up and skim through my highlights. This note caught my eye:
“Dogma at Microsoft had long held that the open-source software from Linux was the enemy. We couldn’t afford to cling to that attitude any longer. We had to meet the customers where they were and, more importantly, we needed to ensure that we viewed our opportunity not through a rearview mirror, but with a more future-oriented perspective.” — Satya
I realized I needed to return to this book and dig in a little deeper as I was now more curious than ever to see how this recent acquisition news played a role in Satya’s overarching vision for Microsoft’s future.
I am glad I took the time to do a bit of research on this topic and glad I returned to this book to see those points that I found interesting back when I first read it. As part of this background refresher I also spent a few minutes looking over Microsoft’s historic acquisitions. The list is quite long as you might anticipate. This obviously ended in the most recent news of Microsoft’s purchase of LinkedIn. And at a price tag of $26 billion dollars I would hope no one has forgotten this transaction yet.
At the time of the LinkedIn purchase, there were questions about the motivations behind this move as well, but again, it’s easy to understand if you consider the approach of Nadella as he looks to the future version of Microsoft:
Satya wrote that he has a "bias" for focusing investments on advancing services such as LinkedIn and Office that help people create and "become more productive rather than software that is simply entertaining -- memes for conspicuous consumption."
Wrapped up in that quote we begin to see a bit of Microsoft’s motivation for this purchase as well. It fits the plan they have strategically set for their future direction. GitHub stands as one of the greatest online destinations for individuals to demonstrate and share their productivity. Following this logic it is easy to see why GitHub holds so much potential value for Microsoft, but what about for GitHub?
GitHub has a long and storied history itself mired in fast success, public stumbles, and the ever-present churning in an attempt to grow revenue. They continued to take larger and larger checks from investors in their search for a path to success. They knew the product direction but they struggled with how to best capitalize on the financial side of things.
For the statistics and numbers junkies reading here’s the financial lowdown on their position. GitHub was valued at approximately $2 billion dollars based on their funding (they’ve raised $350 million historically) and their revenue numbers in 2017 were slightly more than $200M in ARR.
In more recent news (last year) the current CEO, Chris Wanstrath announced his intention to resign. His resignation, unlike his predecessor's, was not forced by any scandal but instead due to his interest in product development and testing. His announcement and subsequent search for a replacement CEO has lead to fruitless searching and things looking bleak for GitHub’s leadership team.
Clearly this is the story of a company in turmoil. Rumors about possible IPO's and potential suitors were growing more common by the day. It was evident that for GitHub's success something had to change.
Open source impact
Of course the reason this particular acquisition has been brought to my attention is due to the open source community. And as I alluded to earlier, the prevailing “anti-Microsoft” opinions of many in the open source world are growing more vocal. But what does this acquisition mean for open source? I think this question is one which would be answered quite differently today than it would have been a few years ago. Again, under Satya’s careful curation we’ve seen a shift in Microsoft’s culture and views towards open source. (This is no small feat!)
But as the press appropriately admonished: Any grand future vision must be met with real and consistent actualities. Microsoft has done just that. I believe a quick look at Microsoft’s current views on open source point to their intentionality:
Microsoft has over 15,000 contributors on GitHub (the greatest of any single company). The company said that over 6,000 employees contribute to open source projects, and have released over 3,000 open source projects. Microsoft’s open source programs office tracks nearly 10,000 open source components, everything from NPM packages to Linux distros used by Microsoft teams. — Source
All of this forces me to think more about what this recent news means for open source and even more personally, for me as a result.
People change, so can businesses
And this is where the learning comes in; the personal challenge to grow and rethink long-held opinions. We all know that people can change. It’s not easy, takes ridiculous amounts of will-power and dedication and ultimately only the test of time will prove the veracity of the change. But in the end, people can change. And if people can change, so can businesses.
Microsoft, under the leadership of Satya, has been focused on rediscovering their soul as a company. They have redefined their mission and outlined steps which help investors and customers to grow the company. As Satya shared:
“In order to accelerate our innovation, we must rediscover our soul—our unique core. We must all understand and embrace what only Microsoft can contribute to the world and how we can once again change the world. I consider the job before us to be bolder and more ambitious than anything we have ever done. Microsoft is the productivity and platform company for the mobile-first, cloud-first world. We will reinvent productivity to empower every person and every organization on the planet to do more and achieve more.” (emphasis mine)
All of this speaks to the core desire to return to what the soul of the company should truly be and the first step in that journey was admitting the failures and missteps which had befallen them over the years. But businesses can change, they can grow, and they can evolve. Perhaps this acquisition is yet another demonstration of Microsoft’s ongoing commitment to rebuild their brand and their reputation. The work they have been doing and the emphasis they have been placing on open source is evident.
As I shared earlier, only in time will we know if this is genuine. Until then the open source community, and the world, will watch with diminishing skepticism as actions attest to intentions. And unless something causes a break in this fragile yet growing trust in a company rediscovering itself — our response should be cautious support.
I’ll leave you with one final quote from Satya’s book.
“Over the years, I’ve found that openness is the best way to get things done and to ensure all parties feel terrific about the outcome. In a world where innovation is continuous and rapid, no one has time to waste on unnecessary cycles of work and effort. Being straightforward with one another is the best way to achieve a mutually agreeable outcome in the fastest time possible.” — Satya Nadella