Microsoft Grabs GitHub In $5bn Shopping Spree

Open Source code sharing repository GitHub has been swallowed by tech giant Microsoft in a multi-billion dollar deal.

The exact value of the cash to change hands remains a secret – but GitHub has 26 million users and recently had a $2 billion tag put on the brand, although the actual price is expected to be nearer $5 billion.

GitHub is a place where software developers go to save time reinventing the wheel by sharing their work with other developers for free who may have already created a snippet or even a complete app that does the job for them.

The site accessed by millions of developers and houses almost 100 million pieces of software code.

Many fear that moving to ownership by a technology monolith like Microsoft will mean a tightening up of site usage and a move away from free access.

Tainted love

However, in recent years, Microsoft has made a shift towards shareware and reportedly, some of the world’s top GitHub contributors now work for the Seattle-based company.

Big name projects like the Linux operating system, Open Office and web browser Mozilla all rely on open source code.

Some developers fear the corporation may taint GitHub in the same way Microsoft botched the takeover of smartphone manufacturer Nokia in 2013.

Speculation by an insider who has seen GitHub’s financial says the web site was burning through cash despite two cash injections totalling $350 million.

“GitHub is also said to have been looking for a new CEO for about a year. Taking so long to find a new CEO doesn’t necessarily mean that there was a problem: perhaps a strong candidate fell through at the last minute causing the search to be restarted or something,” said Peter Bright of Ars Technica.

Money problems?

“GitHub’s CEO search doesn’t necessarily mean that the company’s problem is entirely financial—for example, there may be lingering fallout from the sexism and harassment claims from 2014—but the search suggests that the company is struggling to find someone willing, able, and confident who can tackle these problems, and money issues must rank among the concerns of the CEO of an unprofitable company.

“If money problems were indeed looming, GitHub had only a few solid options. Its backers could, of course, have decided to cut their losses and let the company fold. The effect of this on the open-source world would be devastating, and it’s hard to imagine that any prospective buyer could ever do more harm than this would cause.

“If the desire was to keep the company as a going concern, that meant raising more money. That presents three options: another round of venture capital funding, an IPO, or a sale.”