To buy a social Media Network for professionals. But experts say the combination of Microsofts Office 3 skiff and the Worlds Largest professional social network may in fact help create a new workplace for the modern age. The purchase september shares of linkedin soaring 36 . Microsoft fell more than 2. 5 , making it the worstperforming stock on the dow. The big question now is whether the purchase of linkedin will provide microsoft with the growth its been searching for. Reporter its the biggest purchase microsoft has ever made. And the boldest move by the ceo. What does microsoft see in linkedin that irspine id to pay seven times what the network is expected to make in 2016 sales . Reid, jeff and i have known each other for a while and talking about these things together for a while. To me this is about the next phase of growth for microsoft. Of course we can do things commercially in terms of integration. As i think about the opportunity ahead, around productivity, business process, and the professional network, its a tremendous opportunity to expand our ability to grow. If microsoft can get users of Microsoft Office to spend more time on linkedin and can get more linkedin users to subscribe to Microsoft Office in the cloud, it should boost the Software Giants sales and make its Cloud Services smarter. So far the investing Community Seems willing to give this big bet a shot. I think its smart. I think its the first big thing satia has done in microsoft. They didnt really have a play in social. Reporter the cloud factor is important this year with all the major mechanic titans including google, amazon, facebook, and apple spending money and time on artificially intelligent services. The goal is to build software clever enough to understand spoken requests and make helpful suggestions even before you know when has microsoft ever tried to buy something this big . Just once. Eight years ago it bid more than 44 billion for yahoo , a Company Investors are now happy microsoft didnt end up buying. The question is whether eight years from now microsoft investors will be happy they connected with linkedin. Following that deal announcement, moodys warned microsoft could lose its topnotch aaa Credit Rating. The Ratings Agency is concerned about microsofts plans to fund the deal through new debt. Separately, Standard Poors reaffirmed microsofts aaa crediting rating. Rodney nelson joins to us talk about this microsoft linkedin deal what it means, Enterprise Software analyst at morning star, rodney welcome. You like are have liked microsoft quite a bit. Do you like it more today given this acquisition . Good evening, guys. I would say that were about the same on microsoft as we were coming into this deal. So i think heading into the trade is today, we had a fair value estimate of 61 per share on the name. The deal as it stands today is about neutral in our view. Theres obviously a lot of opportunities that microsoft can leverage from the data that linkedin provides in terms of a social network thats geared towards working professionals. Theres a lot of synergies that microsoft can create. In terms of where we stand on the stocks our outlook is mostly neutral when you incorporate the linkedin acquisition. Moodys put them on watch for a possible downgrade because of the issuance of new debt. Others point out the fact that, yes, they are going to be issuing a lot of new debt but theyre doing it at record low rates. How do you feel about that . Obviously microsoft holds a aaa Credit Rating for most major credit agencies. The cash flow of this business is robust as ever. Obviously they have some legacy businesses that are in decline and that may be part of the reason why the Credit Rating agencies have placed microsoft shares under review in terms of a Credit Rating standpoint. But we think that the decline in some of those legacy businesses is going to be extremely gradual and the cash flow profile of this business is going to remain exceptionally reboust. When you think about the cloudbased initiatives, azure, office 365, dynamic crm, we think the cash flow profile of microsoft is going to remain exceptionally strong the next several years. Linkedin got a premium price today compared with where the stock had been selling. The price microsoft paid, 196 a share or thereabouts, is way below when linkedin was trading for six, eight months ago. The stock along with a lot of social media stocks have gone down. I wonder what you see microsoft seeing in linkedin, given the fact that it will add revenue, it has a growing user base, but profits arent that huge for a company as big as microsoft. Theyre going to move the needle there. Right. So i think one of the things that we really need to focus on is the opportunity that the data sets that linkedin is providing to microsoft, so obviously theres about a 430 million user base in linkedin as a standalone entity, that user base is incredibly valuable when you think about the data that can be leveraged in some of microsofts existing applications. Think about the use cases that could be applied to office 365, say, incorporating some of the Contact Information that exists in your Linkedin Network could theoretically bolster your ability to generate more leads for sales efficacy. Warm leads are extremely valuable in terms of shortening closing der races when youre an enterprise salesperson. If im rig to sell you a peeves software, for example, i can utilize the data linkedin provides, maybe get a feel for where my contact went to school, slip in maybe a brief tidbit about one of their sports teams, i can generate leads that way instead of making a cold call. Its really the value of the data more than the value of the profit stream. Rodney nelson, thanks very much, rodney is with morning star. If you dont own individual shares of microsoft, you likely own them in one of your mutual funds. According to morning star, the top three fund holders of microsoft are the vanguard total stock market index, the vanguard 500 index, and the vanguard institutional index. On wall street, stocks dropped today following the lead of markets over in europe and asia. Government bond yields fell as investors grew concerned about Global Growth and the effectiveness of Central Bank Policies around the world. The Dow Jones Industrial off 132. It finished at test. Test test. Test. Test test. Test. Test test. Test. Test test. That can be talked to or received data from almost anyone on the planet. So very difficult to secure mobile against modern sophisticated attackers. Reporter despite the challenges the wireless association, ctia, tells us, the entire wireless ecosystem is working together and individually to vigilantly protect consumers. According to sharabani, there are three main ways hackers remotely invade your device. One, attack carried out through unsecure wifi networks. The second way, through operating system flaws or bugs. We see that the average ratio is more than one vulnerability being publicly disclosed every day. And 10 of those are critical vulnerabilities. Vulnerabilities that allow someone remotely to gain access to your device and control it. The third attack is through bad or malicious apps, especially ones that are pushed or sent directly to you. Delete those messages being prompted. This app will have access to your email, will you agree . The answer should be no. Think about this sharabani says theres no such thing as being 100 secure. But there are many ways to reduce that risk. Make sure you update your device as soon as upgrades are released. And think twice before you connect to that free wifi. Im andrea day for nightly business report. Coming up, the company thats making a big investment in what it hopes willpower the auto industry. Film School Shorts is made possible by a grant from maurice kanbar, celebrating the vitality and power of the moving image, and by the members of kqed. [ telephone ringing ] man [ speaking arabic ] [ shouting, gunfire ]