On Wednesday, Microsoft officially unveiled Teams — a new work chat app for PCs, smartphones, and tablets that will take on competitors like $3.8 billion Slack and $5.5 billion Atlassian when it fully launches in early 2017.
In response, Slack took out a full-page ad in the New York Times, welcoming Microsoft to the market.
That’s especially notable considering reports that Bill Gates himself talked Microsoft leadership out of placing an $8 billion bid for the red-hot Slack, urging instead for the company to use its own tech to build a competitor. With Teams, it seems like Microsoft took Gates’ advice to heart.
And now, Microsoft is being very clear that despite all the hype around the very well-funded and much-hyped Slack, it’s not worried about competing with the startup, or any of its imitators. After all, Microsoft has Office, and Office rules the workplace.
“Little companies come and go,” says Microsoft corporate VP of Office 365 marketing Ron Markezich, referring to tools like Slack as “applications du jour” that will fade away as Microsoft Teams comes into its own.
‘A very narrow niche’
Markezich says that, from Microsoft’s perspective, tools like Slack “fill a very narrow niche.”
He calls them “little point solutions” that have found success with smaller teams by focusing so heavily on the user interface and letting them get started for free. The original and still primary audience for tools like Slack and HipChat have historically been smaller, more technical or creative teams.
But, he says, these apps just aren’t suited to scaling up to larger companies, lacking in features, security controls, and integrations with business-standard software like Microsoft Office. Markezich says with Teams, Microsoft built something that’s as easy to use as its upstart rivals, but that fills in the gaps for the IT department.
For its part, Slack has lost customers like Uber to its rival Atlassian HipChat over those same concerns around scalability and IT control.
“We have it all covered,” says Markezich. “We are unique in that we are a great friend of IT and a great friend of the end user.”
The master plan
With Microsoft Teams, Markezich says, Microsoft has built a product that’s good for departmental groups of all sizes, at larger enterprises of all sizes, and that integrates tightly with the Microsoft software and services that so many employees at so many businesses already use.
Plus, thanks to Microsoft’s strong (though recently strained) relationship with big enterprise vendors like Salesforce, Office 365, and thus Teams, can hook up with most systems that employees in every part of the business is already using.
“I talk about Office 365 integration with Salesforce more than anything — more than our own [Microsoft Dynamics] product, in fact,” Markezich says.
Plus, Markezich points out, Microsoft already has 85 million monthly active users on Office 365, all of whom get access to Teams when it enters into general availability next year. Slack, for comparison, recently claimed 5.8 million weekly active users.
That’s a lot of potential users, and it’s going to encourage developers to sign up and integrate their products with Teams — hot Silicon Valley companies like Asana and Zendesk have already signed on to provide their tools within Teams, letting users plan projects and assign help desk work right within the chat app.
All of which means that Microsoft Teams can be customised for every team within a business, in a way that its upstart rivals can’t, Markezich says.
“We look at Office 365 as a solution for every team,” Markezich says.
Slack did not immediately respond to a request for comment.
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