After a lot of rumors, Microsoft confirmed today that it has acquired GitHub, the popular Git-based code sharing and collaboration service. The cost of acquisition was $7.5 billion in stock. In 2015, GitHub raised $350 million, when it was valued at about $2 billion.
Former Xamarin CEO Nat Friedman (and now Microsoft corporate vice president) will become GitHub’s CEO. GitHub founder and former CEO Chris Wanstrath will be Microsoft’s technical fellow and work on strategic software initiatives.
The fact that Microsoft is putting a new CEO for GitHub is a clear sign that the company’s approach integrating GitHub will be similar to that applied to LinkedIn.
GitHub says that as of March 2018, there were 28 million developers in their community, and 85 million code repositories, making it the largest host of source code globally and an integral part of how many in tech world build software.
But although its popularity with enterprise users, individual developers, and open source projects, GitHub never turned to a profit and I believe that the company decided that an acquisition was preferable over trying to IPO.
GitHub’s main revenue source toady is paid accounts, that give private repositories and a number of other features that enterprises need, with pricing rating from $7 per user per month to $21 per user per month, while those building public and open-source projects can use it for free.
And although many big enterprises use GitHub it still faces competition from products like GitLab and Atlassian’s Bitbucket. However, Microsoft is acquiring GitHub to fulfill its ambitions of becoming the go-to platform for every developer, and every developer need, no matter the platform.
Yet while Microsoft’s position toward open source has changed over the last few years, many open source developers should keep a very close look at how the company will do with GitHub after the recent acquisition, to the extent that some open source maintainers are already looking for alternatives from now.
