Microsoft's recent announcement to purchase LinkedIn for $26.2B has made some noise with everyone asking, "Why would a technology company buy a business-branded social network?"

So far, the best explanation comes from this Microsoft consultant, who explains Microsoft's thinking from a strategic, Mergers, and Acquisitions (M&A) point of view, stating, "Ten years ago, people bought companies for their R&D, for their engineering, for their hardware. Five years ago, it was for the users for the content. Today it's for the data. Data is king. "Florin Rotar

Thinking through this a little more deeply, I began to wonder what other strategies Microsoft must be employed to justify building a hefty M&A budget.

Parallel, Interlocking Strategies

It seems like Microsoft is conducting parallel strategies aimed at finding new business streams, changing consumer opinion, changing developer opinion, and proving it can remain innovative.

Here are a few strategies I can see so far:

Gold in the Cloud

It's pretty clear that cloud business is a big business. Between 2011 and 2014, Microsoft earned $1B of worldwide revenue (through Azure services). This is still minuscule compared to Amazon Web Services' staggering $1B/year in profit.

Regardless of whether Microsoft has reached AWS's scale, what's clear is that cloud-based businesses are the future of software licensing and online advertising.

Wealth in an Ecosystem

"History doesn't repeat itself, it rhymes."
– Mark Twain

Microsoft has always understood the power of ecosystems. Back when they were selling Enterprise Servers, one of their best investments was fostering a strong developer community. The best tech ecosystems always have a strong developer community.

I see LinkedIn acquisition as a way for Microsoft to find both potential customers and talent for their ecosystem. It's also a way for them to move beyond failed attempts at acquiring Facebook and integrating Yammer.