The enterprise collaboration market became quite crowded in the last week, with a reconfigured Hangouts ready for Google customers and the brand new Microsoft Teams becoming available to Office 365 customers worldwide on Tuesday.
This is something the technology sector has seen before. In a pseudo-disruption, the old guard of tech will use an innovative idea from an upstart company, but with its own spin on it and the ability to leverage it at scale.
"This is the way technology works. Some bright company takes a lot of risks, does something really cool and then everyone else reacts," said Craig Le Clair, VP and principal analyst at Forrester Research. "As has been Microsoft's pattern, it takes the approach of some successful startup [that] really does all the missionary work and then it does it at scale."
The entrance of tech giants into the collaboration market isn't necessarily a bad thing. It hints at market maturity and what customers are demanding from collaboration suites in the enterprise.
"What vendors are starting to realize is that we've had these enterprise social networks for a decade now, and they don't always work on their own," Carrie Basham Young, founder and principal of Talk Social To Me. "It's a realization on the part of the vendors that one size doesn't fit all, and they're actually finally doing something about it.
"As has been Microsoft's pattern, it takes the approach of some successful startup [that] really does all the missionary work and then it does it at scale."
Craig Le Clair
VP and principal analyst at Forrester Research
Microsoft Teams allows for the idea of collaboration with people outside of email by creating a chat-based workspace more robust than Yammer. On Tuesday, Microsoft made the chat-based Office 365 workspace generally available in 181 markets, and 19 languages, with an additional 100 new features since the November preview.
Some big-name customers are already using Teams, including Accenture, Alaska Airlines and Cerner Corp., according to the announcement.
Slack's market foes
Teams' formal introduction marks a true turning point for Slack, which up until this point did not have nearly as commanding a competitor. Though Workplace by Facebook is a worthy opponent, and has a proven ability to scale, it operates in a much different way.
Workplace's true expertise lies in user experience and allows for enterprise-wide reach from the top down, according to Young. Few other tools offer such an organic ability to create dialog from the ground up through an organization's leadership structure.
Microsoft, however, is the true challenger to Slack, something the company acknowledged when it printed a full page ad in The New York Times welcoming Microsoft to the market.
That feeling when you think "we should buy a full page in the Times and publish an open letter," and then you do. pic.twitter.com/BQiEawRA6d
— Stewart Butterfield (@stewart) November 2, 2016
When collaboration tools first went to market with products like Jive and IBM Connections, "the goal was to create a single enterprise digital water cooler," said Le Clair. But many early tools failed to integrate document sharing and some process support along with their communication offerings. "Those three together enable you to get work done in a much better way."
So though Slack has found a sure recipe for enabling communication across enterprises of any size, Microsoft Teams can offer a full collaboration platform. And, with more than 85 million active users on Office 365, the simple integration of Teams into companies already using Microsoft solutions will allow for a seamless rollout.
"I think Microsoft will prevail as a leader in the market. They still dominate the primary form of collaboration, which is email," said Le Clair. And with its vast portfolio of other tools, "they have everything that you would need." Already companies are moving to Office 365 as part of an overall, long-term strategy.
That's not to say that Slack will flounder with a new, major competitor in the market. Rather it is more likely to continue to appeal to smaller, networked teams and will not necessarily beat other giants in the market that already offer tools at scale to millions of customers. "I think that Slack is going to continue to be the sexy and functional choice for small teams," said Young.
Welcome to the party
The competition in the enterprise collaboration is not just between Slack, Microsoft and Facebook. Rather, other major enterprise technology companies are vying for a slice of the market. Chief among them is Google with its revamped collaboration suite announced last week.
Google's true struggle will be in luring enterprise customers away from the Office 365 product suite, which could be a huge, and potentially disruptive, migration effort for customers.
The Office 365 suite does not leave much room for tools like Google Hangouts, which Young anticipates will not see a lot of enterprise traction.
"If you're a Microsoft shop and you're using Yammer and Teams and Groups, you're not going to suddenly migrate over to Google Hangouts and G Suite," Young said. "I think [Google is] too late to the party here, because they're just another suite that's going to try to compete and I think it's too late."
"If [Amazon] just wants to create another chat tool, another video tool, I think the doors are closed at this point. I think, the existing players in the market already have enough of a stronghold to continue to go deeper."
Carrie Basham Young
Founder and principal of Talk Social To Me
Amazon Web Services is reportedly also working on collaboration tools of its own, though these are just "vaporware" until a tool is actually presented to market, Young said. A lot of its success will depend on what it is trying to accomplish in the collaboration market.
"If they just want to create another chat tool, another video tool, I think the doors are closed at this point. I think, the existing players in the market already have enough of a stronghold to continue to go deeper," Young said. "I cannot see, for any reason, an organization abandoning Microsoft when Amazon comes to life."
The one thing AWS truly has going for it is reputation and its popularity with the development community.
"Amazon has such a great track record of doing innovative things and the development community loves them," Le Clair said. "You could see Amazon cutting into Slack's business on the project and development engineering, more technical sides of the house. That would be a possibility if they nail it the way Slack did."
