By buying out Groove Networks yesterday, Bill Gates again demonstrated his superlative business acumen. Groove had impressed Gates so much that he decided to buy the company and make its founder Ray Ozzie, his chief technical officer.
With the Groove merger Microsoft will now be able to move beyond its server-centric collaboration offerings and earn more credibility in the remote collaboration space.
A company release announced that the merger’s objective was to expand their ‘Office’ software business by incorporating Groove’s technology. They would continue to offer Groove's ‘Virtual Office’ product as a component of Microsoft's Office lineup of productivity applications.
Groove had developed the ‘virtual office’ and Microsoft plan a feature which will enable groups of people to share information, documents, spreadsheets, and even manage projects and collaborate on common tasks over the Internet. Groove’s networking software is quite similar to Napster's original music-sharing system.
Ozzie, as chief technical officer of Microsoft will be one of three CTOs who report personally to Gates. Groove will continue from its operational base in Beverly with its 200 strong workforce. But the facility will now become part of Microsoft's Information Worker Group.
Ozzie’s career is marked with impressive highs and this buyout appears to fit in with his general plan. He first started Iris Associates and developed Notes. Iris was sold to Lotus which IBM subsequently acquired. Groove was founded in 1997 to closely align his work with that of Microsoft.
According to market watchers, the buyout does not come as a surprise as Microsoft already had an investment of $51 million in Groove. The acquisition will be completed in Q2 of this year.
