Windows growth has slowed as Microsoft's mobile platform goals have declined and the PC market has matured. As a result, Microsoft had to seek new revenue outside its operating system. As part of this growth strategy, Microsoft announced in 2017 a new subscription product called Microsoft 365, which brings together Windows, the cloud-centric enterprise, Office 365 productivity suite and Enterprise Tooling in a single package.
The introduction of Microsoft 365 has announced the reorganization of the company, which, according to CNBC, has "rebuilt the company in the cloud rather than Windows". If Windows does not return to growth, other services need to increase revenue. Microsoft's evolution into a cloud-based, service-oriented business will therefore continue.
In pursuit of a new non-Windows top-line, Microsoft insisted that it could extend its "commercial cloud" deployment to a $ 20 billion run by the end of fiscal year 201
One of these products, Teams, is a component of Office 365 and part of what Microsoft CEO Satya Nadella called a "growth opportunity" that "reaches much greater than anything else [his company has]."
Today we will examine Microsoft's current activities in part of the cloud productivity space through the lens of teams
Microsoft's team product is a communications tool often compared to Slack . TechCrunch, for example, recently named the software service "Microsoft Slack Competitor." ComputerWorld, in a message earlier this year, wrote that "Microsoft [ed] on Slack heat [the] heat when it announced new teams functions." 19659002] It goes on and on, allowing us to keep Microsoft Teams comfortable as Redmond's answer to Slack, a company known for its rapid growth, impressive mind-share, and independent status from every major technology company. This last fact remains despite the rumors of a takeover by Microsoft itself, along with just about every major company in the industry you can name.
Seeing Microsoft invest in its own tool that competes with Slack is not surprising. There's a big market for the product, and Redmond does not allow a competing service to limit its productivity gains.
So, if a hot productivity tool is on the market and Microsoft does not buy it, it could build its own. Not surprisingly, the company has worked hard to do just that.
Admission to a large company, if you are a relatively small business, can be arduous.
News that teams were able to release a free version made headlines. The teams also gained guest access in February, introducing Cortana integration into mainstream tech publications, and this week Microsoft announced new "retention policies" for teams.
All this and Microsoft have teams this year in the form of Chalkup, a collaborative company focused on the educational world.
In short, teams add new features as they build their organizational chart and expand access. All good things, for sure. Not so long ago, however, Microsoft spent a lot of money to buy another, unique tool for collaboration. What happened?
Microsoft bought Yammer in 2012 for $ 1.2 billion and built on what TechCrunch once called "Social Enterprise Strategy." And while the Yammer-Microsoft deal was "good news" for the company and its investors, it was also the beginning of the "hard part" for the newly acquired start-up.
Getting into a big business, if you're a relatively small business, can be cumbersome. And if you do, when the larger company undergoes a massive leadership change (Microsoft has hired a new CEO two years after the Yammer contract) and a business model change (Microsoft bought Nokia in 2014, also two years after the Yammer contract) before this strategic idea is closed several years later), it is probably even harder to integrate.
Externally, this difficulty was shown. After the Microsoft deal, Yammer's search volume grew before it stagnated and later sank. The product was finally turned on for Office 365 customers in early 2016, four years after purchase. Office 365 itself started half a decade earlier, which is a bit of a stretch in the moment.
But all of this is a thing of the past, and Microsoft in particular puts more emphasis on Yammer today than in recent years. That may be weird, considering what we have just discussed in terms of teams.
To find out, Crunchbase News has interviewed Microsoft's Seth Patton, who informs the company. According to the 15-year-old corporate veteran who now works with Office 365, Microsoft has two separate views for teams and Yammer. Teams are created for what Patton calls Inner Loop communication: stuff for teams, smaller companies, and the like; In contrast, Yammer is better at communicating in the outer circle: less tactical decisions and more enterprise-wide communication.
The separation between Slack and Team products and the Yammers and Convos of the world is not a hokum or mere corporate language. I've been working in newsrooms using the mix of tools to enable easy direct messaging between individuals (Slack) and team-wide thread communication (Yammer). It takes some getting used to, but it can flow well if you need that level of discussion between the parties.
Even more interesting than the fact that Yammer is not dead is that Microsoft is actively investing in them. According to Patton, the bosses of Microsoft "doubled" on Yammer, while teams were launched at the end of 2016. That gave Yammer about a year of doubled investment and attention.
Taken together, Microsoft is investing in two channels of communication products at the same time, both of which are being baked into its productivity suite. So why now the huge boost?
Slack: Software's Most Popular Rocket Ship
You are undoubtedly familiar with Slack's growth path. In recent years, it has been an almost chronic history in technology. And I do not mean that pejoratively. (I'm just as guilty as anyone else.)
But in case you have a lifetime, here are a few highlights: Slack reached ARR of $ 50 million in December 2015. In October 2016, Slack hit the $ 100 million ARR Mark. Then the company won $ 200 million last September. This is damn fast, and investors took note and showered the company with liquidity and rising valuations.
One way to earn money is to worry about the growth of the biggest companies in the market.
Fuelling Slack's continued growth is a boost to the realm of larger companies. The company introduced Slack Enterprise Grid last January, bringing company management tools to Slack's product. With Enterprise Grid, Slack can continue to larger accounts. (At this time, IBM has more than 200,000 active users on Slack who use Enterprise Grid.)
This rapid growth has made Slack an acquisition target. One way to finally be acquired is to worry about the growth of the largest companies in the market. It's hard to do because the established sales figures are so big that you have to grow fast to get interesting.
An even bigger scrap
As we know, Slack has rejected purchase offers. As a result, we see that Microsoft, the dominant player in the world of productivity, is trying to slow Slack down so as not to lose future users and future dollars. Hell, even Google is in the race. The competitor Slack started in February for the first users. Facebook also tinkers around the edges. It's fun to watch.
But productivity is Microsoft's cash cow. For Google, it's a big side project, but nothing compared to its advertising revenue. As a result, Microsoft and Slack compete against each other in the enterprise chat battle. [Inmid-MarchMicrosoftannouncedthat200000organizationsarenowdeployingteamsupfrom125000inSeptember2017That's60percentgrowthinahalfyearyearorso-alsoafastpaceofgrowth)
What we in the Learning next year is whether Microsoft's massive enterprise channel can be leveraged enough to slow Slack's growth, or if Slack's momentum can actually capture some of the productivity market and stick to it.
It's a startup against a platform company, a classic enough battle. But with the big technology that's bigger, richer and more powerful than ever before, it's a more relevant business case than we think at first glance. More if you bring blood or slack to the public.