In June 2018, Microsoft made a significant move in the tech industry by acquiring GitHub, a popular platform for software developers, for a whopping $7.5 billion. This acquisition raised many eyebrows and sparked a flurry of questions. Why would Microsoft, a giant in the software industry, be interested in GitHub, a platform primarily used by developers to store and share code? This article aims to shed light on the reasons behind this strategic acquisition and its implications for both Microsoft and GitHub.
Understanding GitHub’s Value
GitHub is a web-based hosting service for version control using Git. It is primarily used for computer code and boasts over 40 million users and more than 100 million repositories, making it the largest host of source code in the world. GitHub’s popularity among developers makes it a valuable asset for any tech company.
Microsoft’s Shift Towards Open Source
One of the key reasons behind Microsoft’s acquisition of GitHub is the company’s shift towards open-source development. Microsoft has been increasingly investing in open-source projects, and acquiring GitHub, a platform that hosts a significant number of open-source projects, aligns with this strategy.
Enhancing Microsoft’s Developer Tools and Services
Microsoft has a suite of developer tools and services, including Visual Studio and Azure. By acquiring GitHub, Microsoft can integrate these services with GitHub, providing a more comprehensive and efficient platform for developers.
Expanding Microsoft’s Reach
GitHub’s large user base provides Microsoft with an opportunity to reach out to millions of developers. This acquisition allows Microsoft to engage with a community that it might not have been able to reach otherwise.
While GitHub was struggling to monetize its services effectively, Microsoft, with its vast resources and experience, can explore various monetization strategies. This could include offering premium services or integrating GitHub with Microsoft’s existing paid services.
Strengthening Microsoft’s Position in the Cloud Market
Microsoft is in a fierce competition with Amazon and Google in the cloud market. By acquiring GitHub, Microsoft can strengthen its position in this market. GitHub’s strong community of developers can be leveraged to promote Azure, Microsoft’s cloud service.
In conclusion, Microsoft’s acquisition of GitHub is a strategic move that aligns with the company’s shift towards open-source development, enhances its developer tools and services, expands its reach, opens up new monetization opportunities, and strengthens its position in the cloud market. This acquisition is a testament to Microsoft’s commitment to empowering developers and fostering an open-source community. It will be interesting to see how this acquisition shapes the future of both Microsoft and GitHub.