Why is Microsoft buying LinkedIn for $26 billion? An expert analyst speaks out.

Plus: A review of other recent tech mega mergers follows.

Mark Skilton, a professor at The Wharton Business School in London, says Microsoft made the deal announced early Monday because it expands Microsoft’s range of services. (Read also: Why LinkedIn CEO made the sale.)

“The acquisition makes sense in respect of Microsoft’s link with enterprise in its cloud platform and portfolio of enterprise business services, it will help Microsoft build out its enterprise services capabilities,” says Skilton, who is Professor of Practice in the Information Systems & Management Group and is the author of “Building digital ecosystem architectures” as well as “Building the digital enterprise.” 

“The long running rumors of LinkedIn not being able to develop any new growth strategies, with its net income falling year on year from 2011, have finally come home to roost with the Microsoft acquisition of $26 billion in cash.

“LinkedIn has grown a user base of 106 million active users, but compared to 310 million active Twitter users and the mighty 1.65 billion Facebook monthly users, LinkedIn has never managed to grow its commercial services in what could have been a strong enterprise market.

“LinkedIn makes two thirds of its income from talent solutions in recruiting and job market services that define it and the remainder in selling marketing solutions and premium subscriptions. It has remained the website to go to for professional networking.”

Reviewing other big mergers

As the Associated Press reports, the Microsoft-LinkedIn deal ranks as one of the biggest acquisitions ever in the tech industry.

Here’s a look back at some of the others and how they panned out.

  • Dell to buy EMC for $67 billion

Dell’s deal for the data-storage company remains the biggest ever for the tech industry. The deal, announced last October, is set to close later this year.

  • Avago Technologies Ltd. buys Broadcom Corp. for $37 billion in 2016

This deal closed on Feb. 1, making Broadcom Ltd. the parent company of both Broadcom Corp. and Avago Technologies. By joining forces, the rival chipmakers are hoping to make a bigger dent in the rapidly growing market for wireless devices.

  • Facebook buys WhatsApp for about $21.8 billion in 2014

The social media company expanded its messaging capabilities with this purchase. It seems to be progressing well for Facebook so far. In February, WhatsApp announced that it had passed the 1 billion user mark, more than doubling what it had when Facebook Inc. announced the deal. It remains unclear, though, whether WhatsApp will turn into a major moneymaker for Facebook.

  • Hewlett-Packard Co. buys Compaq for about $19 billion in 2002

This deal was championed by then-CEO Carly Fiorina as a way for HP to become a more formidable rival to computer maker IBM, but it faced staunch resistance from some prominent shareholders, including some of the heirs to the HP’s founders.

The acquisition helped establish HP’s largest maker of personal computers for many years, but the deal has lost its luster as sales of desktop and laptop machines have declined with the growing popularity of smartphones and tablets. Last year, HP split into two companies, one focused on serving businesses and the other on the selling of PCs and printers.

  • Symantec Corp. buys Veritas for about $13.5 billion in 2005

The security software company expanded its storage software capabilities with the buyout. This deal turned out to be another mismatch, culminating in Symantec’s decision last year to sell Veritas for $8 billion to the Carlyle Group and Singapore’s sovereign wealth fund, GIC.

  • Hewlett-Packard Co. buys Electronic Data Systems for about $13 billion in 2008

The computer maker aimed to bolster its technology consulting services, but HP has had trouble retaining customers. After HP’s 2015 split, EDS became part of HP Enterprises. Last month, that company said it would shed the former EDS operations as part of an $8.5 billion deal to sell its business services division to Computer Sciences Corp.

  • Google Inc. buys Motorola Mobility Holdings Inc. for $12.4 billion in 2012

The Internet company primarily bought Motorola for its portfolio of 17,000 mobile patents, but Google also inherited an unprofitable division that made smartphones. After losing more than $2 billion in less than two years, Google sold Motorola’s smartphone business to the Lenovo Group for $2.9 billion and held on to the patents. Google had previously sold a Motorola division that makes television set-top boxes to the Arris Group for $2.35 billion.

  • Oracle Corp. buys PeopleSoft for $11.1 billion in 2005

The purchase of the maker of human resources software turned Oracle in to a more formidable rival to SAP in the market for business management applications. In recent years, Oracle has been contending with a new threat from Workday, a specialist in online personnel services that was started by PeopleSoft founder David Duffield.

  • Hewlett-Packard buys Autonomy for about $10 billion in 2011

The computer maker aimed to bolster its software and services offerings with the buyout, but this deal blew up quickly amid allegations that Autonomy had misled HP about its sales. HP absorbed an $8.8 billion charge to reflect that Autonomy wasn’t worth the price that HP paid for it.

  • Microsoft Corp. buys Skype for about $8.5 billion in 2011

The software company bolstered its online video calling technology with this buyout.

  • Oracle Corp. buys Sun Microsystems for $7.4 billion in 2010

The buyout gave Oracle ownership of the Java programming language and catapulted the software company into the hardware business. Analysts have been generally unimpressed with the payoff that Oracle has gotten from Sun Microsystems so far.