GitHub is huge in the software world. Virtually every modern software company, and even most individual open source developers who just write software as a hobby, use GitHub in some way. Cake uses GitHub!
While they've never quite been profitable, GitHub has always had solid revenue (and probably could have been profitable if they had chosen to focus on profitability instead of growth). But with this acquisition Microsoft is probably much more interested in developer mindshare than pure profit.
Millions of software developers love GitHub, and even the ones who don't love it typically respect it. That's what's worth $7.5 billion to Microsoft. Developer mindshare is priceless to Microsoft, and it's something they've been chasing since literally the 1980s, with varying degrees of success.
In the last ten years or so Microsoft has done a really great job of revamping their image among developers and transforming into a very pro-open source, pro-free software company. GitHub bolsters those efforts and also fits nicely in their cloud services portfolio next to Azure, which is trying to compete with Amazon Web Services.
I haven't spent much time looking at or using Azure personally, but I've heard lots of good things about it, and it seems like Microsoft is investing a ton of money and effort into building out a portfolio of services that can compete one-to-one with AWS. In many ways Azure seems to be ahead of Google Cloud Services in that regard.
That said, I think AWS has such a huge head start and so much momentum that it would be incredibly difficult for another cloud provider to overtake them. But Azure can battle it out with Google for the #2 spot, and so far they may be winning.
Hey Ryan....thanks for the technical opinion of the transaction. Not really intended to FLAME, but, IMHO when Mr. Balmer was driving the ship, it seemed his acquisition fever always ended up in distruction. I so wanted the Microsoft Nokia phone experiment to work but that Microsoft store was a disaster. I only bought an IMAC once to be cross literate and thus I was bred on Microsoft and your input is encouraging. With Mr. Balmer currently entertaining his bank account with a basketball team, now we can get down to business. LOL BTW...I am not a coder but daily user of software thus I want Microsoft to continue to innovate. This acquistion seems to provide hope in that direction.
Ballmer made some missteps for sure, but I think people tend to forget that he also made some really great decisions, like negotiating for Bing to power Yahoo Search (which was at the time the #2 web search engine after Google).
Microsoft's shift toward openness and developer friendliness (beyond just the Windows dev community) also began under Ballmer, although Satya Nadella tends to get most of the credit for it.
But I may have a soft spot for Ballmer because I worked at Yahoo Search when the Bing deal happened and the retention bonus paid off my credit cards and a couple of car loans. 😁💸
GitHub represents open and democratic code. It symbolizes digital beauty distilled by the knowledge economy masses (its actually thanks to git and Linus, but nevermind that right now...)
Microsoft, on the other hand, is the king of uncool, buggy, god-forsaken software that never works like Winblows and Office. In fact, I contend that their dominance in the market has resulted in ~100 billion in lost productivity annually in the US alone, and is directly responsible for the rise of IT/Network admin as a real profession.
Bill Gates is a genius philanthropist who has dedicated the second half of his life to undo all the damage he did with Microsoft. Bill, you kicked ass and now you are forgiven.
So now they have hired a CEO that looks like a cross between Steve Jobs and a yogi master and eats nothing but quinoa all day, and followed that act with buying cool companies such as GH. Now you do the math...
It's interesting to see how quickly GitHub got absolutely flamed for their decision to sell to Microsoft...the top trending repository on GitHub for the past few days has been an anti-sale repository (https://github.com/upend/IF_MS_BUYS_GITHUB_IMMA_OUT). My first instinct when I saw that was to think it's an overreaction -- despite the fact that I don't use much Microsoft software, I don't really have anything against them, nor do I think their products are garbage. Maybe as you said, they're resulted in a ton of lost productivity, but I'm guessing that if they weren't causing the productivity losses, those losses would just appear elsewhere.
That being said, the repository that I linked to above was censored from GitHub's trending list, which I do not think was a good first move by Microsoft/GitHub. I'm guessing it'll make the developer community even more serious about the major discussions that've been going on regarding leaving GitHub for GitLab, Wikimedia's Phabricator, and other GitHub alternatives. It'll be an interesting few weeks/months.