Did Teams kill Slack?

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Lancée en 2014, Slack a été racheté pour la somme de 27,7 milliards de dollars par Salesforce.

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Before planetary containment, the number of daily active Slack users around the world was 10 million. On March 25, 2021, a few days after the systematized teleworking, they were 12.5 million. For a company created only in 2013, the success is total. This email-free messaging system has won over businesses and investors alike. Before going public in June 2021, the firm had carried out no less than eleven fundraisers, for a total of $ 1.3 billion. The icing on the cake in December 2021, Salesforce, the American software giant (CRM) bought Slack for $ 27.7 billion.

Everything would be idyllic if Slack had not had to face the dizzying growth of Teams, the collaborative jewel of Microsoft designed in 2016. Its activity of the collaborative platform integrated into the Office 365 office suite has exploded with the pandemic and confinements successive. As of March 2021, the company had 20 million daily active users. Eighteen months later, their number has multiplied by seven, reaching 145 million.

When Slack bets on paid

Jostled, Slack adopts a defensive stance. The platform has this year only communicated on its “Record increase” the number of paying customers without specifying the overall number of users. In 2021, Slack thus claims the acquisition of 13,000 “pros” on these 169,000 premium accounts. An increase in generating activity of $ 273.4 million in total revenue, or + 36% over the previous year, according to the company's latest report.

The growth of paying customers is increasing, but not as fast as that of Teams. Taken aback, Slack now wants to establish itself in the paid tools market. The integration of the collaborative platform with Salesforce gave birth to the digital HQ, a complementary service for the pros. When the deal was finalized last July, Slack CEO Stewart Butterfield said “It was a unique opportunity to rethink and fundamentally reshape the way we work. […] Salesforce and Slack are particularly well placed to lead this historic shift towards a primarily digital world. “

The parallel between the woes of Slack and the meteoric success of Teams is tempting. But, is it Microsoft's fault that Slack is losing ground?

For the American giant, the answer is no: “The two platforms, and their objectives, are very different”, says Nadine Yahchouchi, London director of the M365 suite. Teams certainly allows communication, collaboration between colleagues but also the structuring of data (calendar, edition of online documents, archiving, etc.). The competition, which is healthy, in this market is not reduced to the collaborative aspect. “ In other words, Teams and Slack would not be in the same markets. Teams would have other competitors to deal with, such as Zoom or Google's G suite.

Microsoft is trying to kill us

Stewart Butterfield, CEO of Slack

On the Slack side, the tone is quite different. If the company also recognizes that the tools “are fundamentally different”, it accuses Microsoft of “confusing the market because of its anti-competitive business practices,” said the spokesperson for Slack. “Teams is primarily used for calling, video, and as an access point to Sharepoint. The service was designed to […] lock users into Microsoft's isolation ”, he specifies. And the CEO to insist: “Microsoft may have the unhealthy preoccupation of trying to kill us, and Teams is the vehicle to do it. ”

When Slack strikes back

On paper, their main difference is whether the platform is free or not. Teams is chargeable and is sold as part of the Office pack (from 4.20 to 16.90 Pounds per month depending on the offers) distributed to some 300 million customers. While Slack, whose aura offers a complete version (among others, 5 GB of files and 10,000 messages) completely free. Beyond that, it becomes chargeable (6.25 to 11.75 Pounds per month).

That's why just a year ago, Slack filed a complaint against Microsoft for abuse of dominant position with the European Commission. In the statement, Jonathan Prince, vice president of communications and policy at Slack, said he “Calls on the European Commission to take swift action to ensure that Microsoft cannot continue to illegally harness its power from one market to another by bundling or linking products”.

The request is currently being examined by the Commission. For her part, questioned on the subject, the English director of Teams did not wish to comment on this complaint.

Before Teams, Internet Explorer

Without presuming the verdict, this would not be the first time that the company founded by Bill Gates has been pinned for abuse of dominant position. In 1998, the US Department of Justice attacked Microsoft for illegally using the popularity of its Windows operating system to promote its Internet Explorer browser – without giving users a choice. After five years of legal battle, the final judgment imposed measures on Microsoft to promote competition. In 2013, on the same dispute, the European Commission sentenced Microsoft to 561 million Pounds.

So is Teams killing Slack? Today it is impossible to quantify the number of people who left the second to join the first. Especially since some employees continue to use both services since one is free, the other imposed by the employer.

“Microsoft played its shot well”

“Slack has always struggled to deploy to large accounts with its very fun tools, inspired by its video game DNA, noted Guillaume Gombert, director of strategic projects at Fabernovel, in Les Echos last December. While Microsoft relied on Office 365 for Teams. For companies that are already customers, it was just a feature to add and therefore a less cumbersome process than switching to a new ecosystem. In 2021, Slack's growth is linear, whereas it could have exploded. Microsoft played it well by offering Teams for free for several weeks during lockdown. “

Generally speaking, Microsoft is catching up on the instant messaging market and that market is only increasing. In companies, no going back seems to be possible with regard to the use of these collaborative tools, especially among those under 35. Nearly one in two young people (47%) use collaborative platforms at least once a week, according to an OpinionWay survey for Slack to be released on August 31.


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