Subtext of Socialtext Migration Offer: Yammer Not Enterprise Ready

Ann All

When I interviewed Steve Apfelberg, vice president of marketing for Yammer, back in September, he told me two of Yammer's key strengths are its simplicity and its "virality," meaning the ability for Yammer users to invite other folks to become users. Both of those things, especially the virality, are lacking in the enterprise environment, he said:

... Any person in a company can be the first person to use Yammer and start a Yammer network for that company. It doesn't have to be an executive, doesn't have to be someone in IT, doesn't have to be someone in central procurement. It can be anyone, on any level, in any department. That's how we get to so many places, so quickly. You can go to our website, sign up and be using Yammer within 60 seconds.

Not surprisingly, many IT organizations aren't big fans of this approach to adoption. Social software provider Socialtext is hoping to gain some new business by offering a migration offer targeted at companies with more than 100 Yammer users. Customers running the free version of Yammer with more than 100 users will be able to switch to Signals, Socialtext's competitive microblogging product, for $4 per user per month. That's $1 less a month than Yammer charges for its Enterprise product.


When I spoke to Socialtext CEO Eugene Lee, he told me in his discussions with prospects he's heard complaints from IT folks who don't like paying $5 a month per user simply to gain control of the software and any potentially sensitive data it might contain. The dilemma for a freemium model in the enterprise, Lee said, is "where you put the gates between free and paid."


IT organizations might not balk at paying for added features such as recording capabilities, integration with company directories and standing phone numbers for an otherwise free conference calling service. But they don't want to pay for controls they feel should be already included.


Social software companies selling to enterprises "need to make products users love but IT loves as well," said Lee. Socialtext's early entry into the social software market in 2002 (with a wiki product) has given it ample experience in working with both business users and IT organizations, he said. That experience informs how it markets, sells and supports its products.


It's no surprise Socialtext and Yammer are butting up against each other in the enterprise. Yammer started with a microbloggng tool and late last year added new social features and an application development platform. Opening up a platform to third-party developers is part of a push to broaden Yammer usage. As Apfelberg told me, it "will enable a whole slew of applications to be built on top of Yammer and [to] work in conjunction with Yammer. ... I think that brings other day-to-day operational business applications that are used regularly into Yammer."


Socialtext sees its broader suite of functionality (social directories, wiki workspaces, customizable dashboards), added security options (notably a software-as-a-service appliance that can be deployed behind corporate firewalls) and the ability to integrate Socialtext software with enterprise applications as key selling points for enterprises. Socialtext offers a "richer, broader growth path from microblogging," Lee said. While microblogging is a great starting point for social software because of its ease of use, the "real value comes from integrating it with enterprise software systems."


Socialtext's decision to target Yammer users seemingly indicates the company sees Yammer as one of its closest competitors. As this TechCrunch item says:

... There are a number of competitors in the space, yet Socialtext targeted Yammer as opposed to Salesforce's Chatter, Socialcast, Jive, Bantam Live, Success Factors' CubeTree and others. Socialtext has not released a migration tool for any other service and doesn't appear to be releasing any other tools in the immediate future. The fact is that Yammer is growing fast and competitors are using aggressive tactics to gain (and retain) users.

More particulars of the migration offer: Paying Yammer customers with more than 100 users can take advantage of a slightly different offer, to receive Socialtext Signals and Socialtext People for free for a year if they purchase the entire Socialtext social software platform for two years. The offer excludes current Socialtext customers.

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