LinkedIn is the world's leading B2B social network.
It's a rapidly growing platform where millions of users from different backgrounds around the world share their expertise and professional experiences.
Since June 13, 2016, the term "GAFAM LinkedIn" can now be used to refer to the LinkedIn company, as the once-independent company was acquired by a GAFAM.
What is a GAFAM, and who exactly owns LinkedIn? Do other globally known social networks also belong to a GAFAM? Everything is explained in this article.
LinkedIn, the Google of the professional world
The social platform LinkedIn, now widely used in the professional world, was created in 2002 by Reid Hoffman and launched in 2003. It is the reference professional social network, linking companies, recruiters, and employees.
LinkedIn offers multiple features to its users, and each registered member can at least:
- Boast about their skills, professional experiences, and education on their LinkedIn profile
- Interact with other LinkedIn members and add them to their network
Access all notifications from their direct network members directly from the LinkedIn homepage
- Apply for job offers (or create them) on the social-professional platform
- Create (or read) web pages, presentations, or videos
- Join (or create) LinkedIn groups.
Thus, LinkedIn is a springboard for those looking to unlock business opportunities, networking, or employment.
Therefore, it is no coincidence that GAFAM LinkedIn today claims more than 546 million registered users, spread across more than 200 countries and territories around the world.
Moreover, why "GAFAM LinkedIn"?
5 multinationals are known to be the most powerful technology companies in the world.
By definition, a GAFAM is one of these 5 companies.
The world is interested in GAFAM because their products and services are used by billions of people around the globe. GAFAMs have a dominant position in the digital market, and many internet users wonder what belongs or does not belong to GAFAMs.
To indicate that a digital tool belongs to a GAFAM, a common practice is to precede the name of the digital product with the term "GAFAM".
Hence the expression "GAFAM LinkedIn", to signify that the professional platform LinkedIn belongs to a GAFAM.
Microsoft, the new owner of LinkedIn
On June 13, 2016, Microsoft (or more formally Microsoft Corporation), the American multinational founded by Bill Gates and Paul Allen, announced the acquisition of LinkedIn.
For the amount of 26.2 billion dollars, or 23.4 billion euros, we witness the largest transaction in the history of social media.
Indeed, the acquisition of LinkedIn surpassed the record held by Facebook for the acquisition of Whatsapp at 19 billion in 2014.
LinkedIn's ownership by GAFAM Microsoft has allowed LinkedIn to complete its offer for businesses, with Outlook, Office, and other professional communication tools such as Yammer and Teams.
Why did Microsoft buy LinkedIn?
LinkedIn's slow rise to power
After a difficult start, LinkedIn found its place in the emerging social network market in the second half of the 2000s, thanks to the enthusiasm of American SME executives.
The social network was especially popular for recruitment.
In 2011, LinkedIn generated more than 154.6 million dollars in advertising revenue, far ahead of Twitter. LinkedIn became a unicorn very early on, with a valuation exceeding one billion dollars in June 2008. In October 2009, Silicon Valley Insider ranked LinkedIn 10th in its list of the 100 most lucrative startups.
The acquisition of LinkedIn by Microsoft
However, the company suffered a severe blow in February 2016. Indeed, following the publication of a report on its results, LinkedIn's shares dropped by 43.6% in one day, with a record loss of 10 billion dollars in market capitalization.
This did not prevent the company from being acquired by Microsoft for more than 26 billion dollars, or 196 dollars per share. To this day, it is the second-largest acquisition made by Microsoft. The terms of this operation were not disclosed, but the specialized press mentions a 100% cash transaction with debt financing. "Microsoft will allow LinkedIn to keep its brand, culture, and independence," the press release on the acquisition reads. Furthermore, Jeff Weiner, CEO of LinkedIn, was retained.
What is a GAFAM?
Like its counterparts Instagram, Whatsapp, and Twitter, LinkedIn is a social network that does not operate alone. There are 5 multinationals, all American and concentrated in the digital sector, that hold a significant portion of the global internet. They are identified by an acronym revealing their identity: the GAFAM (Google, Apple, Facebook, Amazon, Microsoft). These companies became well-known from the advent of the Internet, thanks to their services used by almost all internet users:
The GAFAM Google became known for its search engine, which is the most used in the world. According to the 2023 Statcounter report, Google holds about 93.18% of the global market share in the online search sector. Today, much more than just a search engine, GAFAM Google also owns collections of tools (YouTube, Waves, Drive, Maps) and operating systems (ChromeOS, Android).
GAFAM Apple lives 80% off the sale of hardware and is known for its devices (iMac, iPhone, iPad) that operate with the company's operating system.
The popularity of GAFAM Facebook comes from its social network Facebook (renamed Meta since 2021), which has achieved global success. Created in 2004, the social platform now has nearly 3 billion users.
GAFAM Amazon is renowned for its online commerce site, through which users can buy and have delivered all types of products. This digital giant lives 82% off online sales.
GAFAM Microsoft became known to the public through its Windows operating system. Today, the company lives 62% off the sale of its software as its software suite is widely used worldwide.
The Acquisition of Social Networks by GAFAM, a Common Practice
GAFAMs have a major influence in their respective sectors and on the tech market as a whole.
These technology giants are powerful companies that continue year after year to build a global empire: GAFAMs alone reach a market capitalization of 4.5 trillion dollars and occupy the top five spots in terms of market capitalization on the NASDAQ.
Acquiring market shares of influential companies is the strategy used by these GAFAMs, and the immediate effect of this practice is their rapid growth.
GAFAMs are pejoratively called "Big Tech" in the United States, and their official representatives, such as Jeff Bezos, Ryan Roslansky, Bill Gates, and Steve Jobs, are generally viewed unfavorably by internet users because they alone hold:
- A significant number of users on their platforms: for example, the Facebook platform has 2 billion subscribers.
- A large scope of data stored: Billions of data and documents (photographs, videos, etc.) are stored on GAFAM servers.
- A strong impact on individuals' ways of living: In a decade, social networks, for example, have evolved the way individuals interact, move, work, and consume...
The Impressive Figures of GAFAM
The democratization of the web, the normalization of smartphones, and technological advancements have enabled GAFAM to break records in terms of economic performance and valuation. Just recalling a few figures demonstrates that GAFAM's influence surpasses that of some international institutions:
- The combined revenue of GAFAM far exceeds the GDP of France (2.995 trillion dollars against 2.420 trillion dollars);
- Apple is valued at 2.504 trillion dollars... a value corresponding to the market capitalization of all companies in the CAC 40;
Other Web Giants
Other Silicon Valley companies have joined GAFAM, known as NATU (Netflix, Airbnb, Tesla, Uber).
There are also significant Web players outside the United States, such as BATX (Baidu, Alibaba, Tencent, Xiaomi).
Due to their significant global audience, these companies have an impact on several economic and geopolitical decisions worldwide.
Which GAFAM owns the other social networks?
Which GAFAM owns Instagram?
Instagram is the social network that has innovated the means of online exchange and communication. Moreover, it has revolutionized the world of marketing, making famous the trade of products and services through "influencers." The acquisition of Instagram was initiated in 2012 by GAFAM Facebook, for only 1 billion dollars. A good deal for Facebook at that time, given the weight of this network in the current digital world.
Which GAFAM owns Whatsapp?
The acquisition of Whatsapp was made in 2014 by GAFAM Facebook, allowing it to expand its instant messaging offer. This purchase enabled Facebook to acquire:
Which GAFAM owns Youtube?
Youtube is undoubtedly the platform with the highest audience in terms of online video streaming. It is the second most popular website after Google. Launched in 2006, Youtube has more than 1.8 billion active users and users spend more than a billion cumulative hours on it each day. Since 2006, Youtube has been owned by GAFAM Google.
Which GAFAM owns Tiktok?
Created in September 2016, Tiktok is an application that has seen rapid evolution in the world in recent years. It is a social network with more than 500 million registered users that mainly involves creating and sharing short videos. Unlike other social networks, Tiktok does not belong to any GAFAM but is owned by a Chinese company known as ByteDance.
Which GAFAM owns X (formerly Twitter) and Snapchat?
As of now, X (formerly Twitter) and Snapchat are independent social networks and do not belong to any GAFAM. In 2022, American billionaire Elon Musk (also the founder of Tesla) bought Twitter and renamed it X.
What are the other networks of the GAFAM?
Each GAFAM owns its own companies
219 companies, among which are: Superpod, Alooma, Android, YouTube, Blogger, Nightcorn, Looker, Fossil
The main companies are:
The social network Twitch
Whole Foods Market
Still very well known as Facebook, Meta contains several companies, among which are:
Some of Apple's firms include:
And finally, Microsoft, which has the most visibility in stores thanks to Windows and is arguably the most well-known of all the GAFAM companies.
In addition to LinkedIn, GAFAM Microsoft owns the following companies:
Nuance Communications (Dragon)
MICROSOFT also owns a few smaller companies such as Groove Music, Wunderlist, and SwiftKey.