*NEWS*SOFTWARE LEGEND JOINS MICROSOFT

[Anonymous]

Software legend joins Microsoft

Software giant Microsoft is to buy Groove Networks, the maker
of computer programs for “virtual offices”.

Collaborative software that allows employees to work together over the
internet from various locations has been growing in complexity and usage.

And Microsoft has been focusing on the field ahead of new releases of its
Windows and Office programs.

Groove founder Ray Ozzie – an industry legend – will join Microsoft as one of
its chief technical officers.

Mr Ozzie, 49, created Lotus Notes for IBM in the 1980s, the first messaging
application to achieve widespread sales.

“Increasingly, the ‘office’ is defined as wherever you and your laptop happen
to be – a customer’s conference room, an airplane, a hotel room, a coffee shop
or a home office,” he said.

“This new era will be characterized by highly interdependent relationships
and systems, and I and others at Groove look forward to joining with Microsoft
to shaping the software that runs these systems.”

Peer-to-peer

Groove will become part of the Microsoft division that includes its Office
suite of programs.

Financial terms of the purchase were not disclosed but Microsoft had
previously invested $89m (£46m) in Groove.

Microsoft scores a double-whammy with the acquisition of Groove Networks

In total, the privately-held firm has received $155m in financing from
investors, including Intel’s venture capital unit, since it was founded in 1997.

Its 200 employees will continue to work from their HQ at Beverly,
Massachusetts.

Groove’s Virtual Office utilises the same peer-to-peer technology seen in
illegal mp3 file sharing networks.

The company has worked closely with Microsoft for nearly five years and
analysts expected it would eventually be acquired.

Further consolidation?

Microsoft said Virtual Office will complement its existing collaborative
offerings such as its Sharepoint group of products.

The purchase follows predictions by Forrester Research of consolidation among
collaborative software developers as the likes of Microsoft, IBM and Oracle
focus on the field, buying companies or licensing their products in the process.

Simon Reynolds, head of European Collaboration at software application
provider Vignette, said the deal was further evidence that Microsoft and IBM
were “slugging it out” in an area that was becoming “critical” to their
businesses.

But he thought the purchase would present an “interesting challenge” for
Microsoft as it integrated Groove’s technology into future product lines.

Richard Edwards, IT analyst at Butler Group said Microsoft had acquired a
ready-made platform and “one of the world’s great software pioneers”.

“Microsoft scores a double-whammy with the acquisition of Groove Networks,”
he added.

“The acquisition of Groove Networks will undoubtedly inject a new life into
the flagging Microsoft Office System family.”

[Author]

March 20, 2005 at 10:42 AM