It’s no longer controversial: The tech universe rotates around developers. A little over a year ago, I wrote about how developers are more powerful than ever. They play a critical role in turning raw technological power into custom applications that make life easier – and create value.

Over the last decade, they have ascended to become the most important force and decision-maker in stewarding technology adoption and, increasingly, business innovation.

Microsoft has long led the way in understanding the power of developers in creating value at scale, and it extends that grand tradition by positioning itself at the forefront of this evolution. Look no farther than Steve Ballmer’s infamous “Developer Dance” from years past to understand Microsoft’s (sometimes-sweaty) long-term commitment to the developer ecosystem. That approach has paid off: Among the approximately 30 million software developers in the world, an impressive 8 million are .NET developers who contribute to Microsoft’s vibrant Windows ecosystem.

This robust developer ecosystem is one of the primary reasons for the continued dominance of Windows and Office in the world. (Notably, these ecosystems specialize in C# – a programming language originally developed by Microsoft that has become one of the most popular languages in the world and which helps lock enterprise developers – read: the ones with the budget – into Microsoft).

And so Microsoft’s announcement Monday that it intends to acquire GitHub for $7.5 billion is more retro than novel. But in bringing Microsoft back to its roots, Satya Nadella’s latest multi-billion-dollar gamble is an incredibly smart one that I predict will ensure the company’s continued leadership with developers well into the next decade.

Satya and team have come to realize that open-source software – and GitHub by extension – is the most critical force in the developer landscape today. It’s no coincidence that the company has the most open-source contributions to the repository of any organization in the world.

Just as .NET is the de facto framework for Windows, GitHub is the de facto hub for open-source software – which is equally important for the web and server-side code. Most code is reused, and the vast majority of new tech companies rely on open-source code so they don’t have to start from scratch. Starting projects faster is only getting more important in today’s hyperspeed innovation environment because having code ready to go at the outset decreases cold start time. Ditto for scaling projects once they are live.

GitHub’s growth is also a fantastic example of the power of network effects in developer communities (see law No. 6!). Just as social networks like Facebook become more useful as more users join and use the service, developer platforms that exhibit these effects do too.

Thanks to the ongoing contributions from developers everywhere, GitHub’s code base continues to grow more valuable, faster – with an ever-expanding moat that becomes harder and eventually impossible to displace. For instance, how many users are really abandoning Facebook because of their data privacy laxness? Is it making any discernible dent in their business? Not much; the network effect is too powerful.

Finally, this partnership features an amazing fit in terms of leadership and team. GitHub has been operating without a long-term CEO for some time – probably too long. Microsoft will install Nat Friedman, the former founder of Xamarin (itself a Microsoft acquisition) and a leader who understands open-source communities better than anyone, as CEO. I can’t think of a better person to call up off the bench than Nat.

While $7.5 billion is a premium price to be sure, I predict that with the benefit of time, this acquisition will look like a bargain in the vein of YouTube or Instagram – consumer platforms that experienced massive value explosion post-acquisition thanks to network effects. Not only does this deal accelerate Microsoft’s existing momentum with developers, but it positions the company as a steward of the key hub of innovation – software. GitHub should only become more valuable over time as these effects continue to compound, leading to even more value for its new owner.

Monday’s news cements developers’ preeminent position in the tech industry and underscores Microsoft’s steadfast commitment to becoming the company for empowering this community. It’s a return to Microsoft’s roots as a “developers as customers” company that started selling BASIC interpreters for the Altair 8800 in the ’70s and dominated the personal computer market by owning the platform for building PC software with MS-DOS in the ’80s.

Smart move, Satya.

Ethan Kurzweil is a partner at Bessemer Venture Partners where he invests in developer platforms and consumer tech startups.

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