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Microsoft buys networking site Yammer for $1.2bn

Microsoft step up battle with Google

Microsoft confirmed on Monday that they have acquired Yammer, the networking site said to be the Facebook equivalent for business. The four year old company already has over 5 million corporate users and is used by companies such as Ford and Deloitte.

The acquisition will help Microsoft to diversify their range of software products and comes just over a year after buying the video-calling firm Skype for $8.5bn. These agreements are though to be part of an attempt to counter challenges to Microsoft's dominance by Google.

Started by PayPal founder David Sacks, Yammer provides a means of communicating within the office. Sachs believes that Yammer "set out to do something big", something that fits with Microsoft's aim to diversify it's office products to provide more online services.

Sacks also claims that joining Microsoft will give Yammer "access to the technologies, expertise and resources we'll need to scale an innovate".