June 6, 2018

Microsoft buys GitHub

Good morning,

GitHub Octocat

There have been rumors in the net, now it is finally confirmed: Microsoft has bought GitHub1 - and the community is in panic. Many open source projects fear that Microsoft will use its influence to harm them and push their own agenda. Let's take a look at the pros and cons of the "GitHub sellout" and the involved parties goals.

Why would Microsoft buy GitHub?

I think this one is easy: Microsoft has used GitHub as a code hosting platform for many years. They moved some of their biggest projects to GitHub in 2014/20152 in preparation of closing their own platform CodePlex.3 Today Microsoft has over 1800 repositories on GitHub in their main account. In addition, Microsoft has embraced Git as their main versioning tool and has moved all of the windows source code into "the largest Git repo on the planet".4 Strategically, it makes perfect sense to me, that Microsoft would buy GitHub. This move allows them to tailor their main code hosting platform to their needs as well as the needs of their customers (= developers on the Microsoft platforms).

Why would GitHub be sold?

In 2012, Chris Wanstrath, one of the founders of GitHub, stepped down to let Tom Preston-Werner (another co-founder) take the lead. In 2014 Chris Wanstrath again became CEO, but by the end of 2017 wanted to step down again (Mid 2018, GitHub had still not found a replacement for him). By then, the company had a recurring annual revenue of $200 million and was valuated at $2 billion.5 They never earned a penny, though. If you were in this position and Microsoft would come to you, saying: "Well, this company is worth $2 billion, we'll give you $7.5 billion for it (and we have a good CEO for it, as well)", what would you do? I know I would sell!

And what about us?

Microsoft logo

So what do we, as users of GitHub, take away from that? I personally think, that Microsoft will not change GitHub in a radical way. There will be changes, don't get me wrong, and some will be great, some will be not so great. Overall, however, I think GitHub has finally become a stable company (and with that, platform). Microsoft does not need GitHub to make money, they need developers to use their products, they need a community. And that's what they try to get from this acquisition. Also, I am happy to see that there is again a good CEO leading GitHub. Not that Wanstrath was not good (he made GitHub what it is today), but he did not want to continue and there was no replacement in sight. Well, this problem is solved now.

All in all, I look forward to the development of GitHub as part of Microsoft. There are risks, of course, but there are also great opportunities for GitHub to become even better. I hope the latter will be for us to enjoy.