Microsoft recently
launched Microsoft Teams to compete with Slack as the workplace communication
and collaboration software. While this launch from Microsoft was much
talked about already but Slack CEO Stewart Butterfield's open letter to Microsoft added an unexpected flavor
to the duel.
What really is Slack
? As per Wikipedia- Slack is a cloud-based team
collaboration tool. The name is actually an acronym, which means,
"Searchable Log of All Conversation and Knowledge". Slack was
launched in August 2013.
...And What is
Microsoft Teams? Microsoft prefers to call Microsoft Teams as a
new chat-based workspace in Office 365. As it defines, Microsoft Teams is an
entirely new experience that brings together people, conversations and
content—along with the tools that teams need—so they can easily collaborate to
achieve more.
Given the fair share of success that
Slack has had so far, it can be credited for being a creator of this new
product category and Microsoft a competitor. What could be potential factors
against which we can size up the competition between the two?
A battle of a Product
and a Feature:
Though it is touted as
a battle among the equals, there is a fundamental difference between Slack and
Team. Slack is a product. Microsoft Teams is a feature. Teams is a part of
comprehensive Office 365 suite. Office 365 does many things but Slack is laser
focused on being a office messaging app.
Microsoft Teams-
almost at feature parity with Slack:
Microsoft is looking
at Teams more as a software that unifies many of their existing applications.
As Satya Nadella said recently
"Just like Outlook brought
together email, contacts and calendar into one magical user experience
scaffolding that changed how we worked, Teams will bring together chat,
meetings, notes, Office, Planner, Power BI... and other extensions and
applications to help users get work done,"
Beyond Unification of existing
office apps, Microsoft Teams already mirrors quite a few features of Slack as
is evident in this comprehensive feature analysis between the two.
Strategy to Gain users:
Building a software product for sure
is hard, but not many realize the complexity of ensuring a successful
go-to-market of software products. The strategy to gain users often becomes a
key differentiator between the competing products.
Microsoft
Teams doesn't plan to go freemium in attempt to gain users. Freemium
model is when the offering has some "free" features (to attract the
users) and some "premium" features (to lure users to pay for more
beneficial features). The fact that Teams is an Office 365 feature is its
biggest strength. Through this association, Teams gains an access to enormous
number of Office 365 customers.
On the contrary, Slack runs on
Freemium model. One of the better ways to introduce new product to users is
through this model. This has ensured initial usage of slack and helped in
building the much-needed credibility. According to an recent user estimate, Slack has over 1.25 million
users worldwide and 33000 paid teams using it.
Market Segments:
Microsoft Teams has a unique advantage
of leveraging the large enterprise customers that Office 365 might already
have. Whereas Slack, being a start-up won’t have that luxury. Slack at the
moment has been gaining a good traction in both smaller and larger
enterprises.
External Collaboration:
Slack allows for an easy
participation of team members outside the organization. Since Microsoft Teams
is bound with Office 365 subscription, it doesn't have an easy (or rather any)
way to allow external audience from participating in the communication. Given
the complex nature of collaboration in today's world when partners beyond
existing employees often help with the decision making, not having this feature
could prove to be a deterrent. This feature is said to be on the roadmap of the Teams software.
Leveraging Artificial Intelligence:
There are a still a few years before
AI becomes a routine feature. Atleast for now, AI is one of the
key differentiator among the software products. Both Slack and
Microsoft Teams have leveraged AI by introducing task specific bots that help
team collaboration. As an example, Microsoft Teams has a bot called T-Bot that
is available to answer questions during the conversation, then there is a
WhoBot who helps to answer questions about the team members. Meanwhile Slack
seem to be overrun with many bots that users already seem to
have gotten a good taste of.
Open Platform vs
Closed Ecosystem:
As Slack CEO says in
his open letter to Microsoft-
an open platform is essential.
Communication is just one part of what humans do on the job. The modern
knowledge worker relies on dozens of different products for their daily work,
and that number is constantly expanding. These critical business processes and
workflows demand the best tools, regardless of vendor.
That’s why we work so hard to find
elegant and creative ways to weave third-party software workflows right into
Slack. And that’s why there are 750 apps in the Slack App Directory for
everything from marketing automation, customer support, and analytics, to
project management, CRM, and developer tools. Together with the thousands of
applications developed by customers, more than six million apps have been
installed on Slack teams so far.
This is an area where
slack probably scores over Microsoft. Microsoft has a reputation of being a
closed platform, or atleast not as open as modern platforms like Amazon,
Facebook and Google. It does warrant a mention that Microsoft, under Satya
Nadela is working towards fixing this aspect of the business by embracing
Linux, building software for Mac etc.
In product management,
there are different strategies that either help first-mover (Slack) consolidate
an early advantage or there are strategies that help fast-follower (Microsoft)
learn from the mistakes of first-mover and emerge stronger. Microsoft has been a
dominant force in the Enterprise Office software category. Given its openness, Slack is
touted by many a analysts to replace email and other office communication
software. The positioning of Slack in the
Unicorn category and its ever-increasing popularity has certainly made
Microsoft a bit nervous. On the other hand, Microsoft has a huge muscle power
built by the enormous piles of cash and a strong network of partners which
won't let it reach Obsolescence any time sooner.
It’s hard to predict
who wins this battle eventually but it is certain that this new category of
software enabling Office communication is here to stay and there would be room
for many a players to seize the initiative. Microsoft's entry in this space
only validates the need of this product category. So far Slack seems ahead and
Microsoft seems well positioned to play the catch-up game for next few quarters
atleast.
What
do you think ?
