Enterprise

Salesforce and Microsoft have an uphill battle to own collaboration

Integrations with smaller firms are key to both companies' plans. Those same upstarts don't want Slack and Teams to dominate the world of digital work.

Salesforce and Microsoft have an uphill battle to own collaboration

Both Salesforce and Microsoft aim to embody the future of work.

Photo: Austin Distel/Unsplash

Two companies are battling to provide the de facto collaboration platform for enterprises: Salesforce and Microsoft are intent on expanding beyond quick ways to send messages to a colleague into systems that support the bulk of everyday work in an organization.

But increasingly, the very application providers those companies are courting to add functions within Slack and Teams are building productivity and social features into their own apps. And that poses a key challenge to the collaboration giants' vision of this unfolding market.

By 2025, as many as 65% of software providers will offer some version of collaboration or social tools, according to Gartner. By adding those features, providers are encouraging users to conduct more work within those applications. And that poses a quandary for Microsoft, which has long offered team-productivity products, and Salesforce, which is in the process of absorbing Slack: What happens if customers are increasingly spending time away from the platforms the two companies are trying to market as the prime place for collaboration?

Slack and Microsoft have been racing to build low-code or no-code tools to automate workflows, which in theory reduce the need to pop out of the chat environment into other apps. But unless those tools become significantly more powerful, Slack and Teams risk becoming simple pipes for messages from more powerful, dedicated-purpose apps that prompt workers to leave the collaboration space and do work elsewhere.

Both Slack and Teams are about "the superficial work," said Deidre Paknad, the CEO of Workboard, a provider of tools to help teams align on goals. (Workboard counts Microsoft as an investor.) "If you take the application providers out … there is nothing novel there."

That is the exact scenario both Microsoft and Salesforce want to avoid. The companies are striving to allow users to manage more and more of their daily workflow within Teams and Slack. In addition to their workflow tools, they're offering ever more sophisticated webhooks and APIs to persuade software developers to build streamlined versions of their apps that run within Slack and Teams. Slack has more than 2,400 in its App Directory, and Microsoft has 911 in AppSource.

Users "don't want to leave their home of Teams," said Nicole Herskowitz, Microsoft's general manager for the product. Instead, "they are wanting to have these integrated experiences."

If you ask the CEOs of the vendors providing some of the most widely-used collaboration software, however, such a future is nothing more than a pipe dream.

"Those are communication applications. They are increasingly trying to do more pieces of work in those applications, but they are not the default work application," said Atlassian co-CEO Mike Cannon-Brookes. "It's a nice marketing spin for them, but realistically that's bullshit. That's not what actually happens."

Salesforce, which expects to close its acquisition of Slack by the end of July, did not respond to an emailed inquiry.

Redmond's battle to lose

Microsoft is widely regarded as the leader in the ongoing battle to own daily work. CEO Satya Nadella even revamped the company's mission around the idea that it will "empower every person and every organization on the planet to achieve more."

But it's also shown its weakness several times. The Yammer acquisition was a bust. SharePoint never scaled to become the collaboration platform that Microsoft intended. And Skype lost its spot as the default video chat tool, a missed opportunity on which Zoom gleefully capitalized. (To be fair, Salesforce also failed with Chatter, a Yammer clone that never caught on.)

Microsoft has a much better shot with Teams, which now has over 145 million users. But now it has to deal with the ballooning use of distinct applications within enterprises. Everything from Asana to HelloSign to Smartsheet has reported a work-from-home surge.

"Some of those applications are growing at paces I've never seen," David Politis, the CEO of app monitoring firm BetterCloud, told Protocol. He believes that growth will require Microsoft and Salesforce to abandon a strategy of "forcing everyone into a single platform. The days of that, it's factual that they are over."

That growth in usage is why the delicate dance between platform providers and application vendors risks growing more contentious.

"At the moment, it's pretty symbiotic. They both have to exist," said Workboard's Paknad. But if Microsoft alienates app developers out of Teams by trying to build too much in, it could put consumption at risk, she added.

That's particularly true as smaller vendors gain success focusing on specific industries or functions, creating features that will be difficult for the behemoths like Microsoft to create on their own. Providers like Chorus.ai are able to get richer data about specific workflows, which means their algorithms will in theory gain better and better performance over time.

Companies like Salesforce helped build a "multitrillion-dollar industry by basically taking form fields and moving them on to the web. That is child's play compared to what is coming next," said Gordon Ritter, the co-founder of Emergence Capital and an early investor in Zoom and Salesforce. "Those software players better really reimagine and rearchitect their systems or else they are going to get left behind by the new players that have access to the granular data."

Integration is also a difficult and expensive endeavor. Microsoft and Slack have an advantage there, in that most app developers aren't likely to build bots or integrations for more than a couple of workplace collaboration platforms.

But the sheer number of apps in a directory doesn't tell you how deep those integrations go. And that's a crucial question in figuring out whether a worker will stay in Slack or Teams or bounce out to a specific app.

HelloSign, for example, integrates with both Teams and Slack. But Chief Operating Officer Whitney Bouck says those partnerships aren't robust enough right now to keep users exclusively in those platforms.

"The integrations don't fully exist to let people do everything in one place," she said.

Take Atlassian, for example. While its Trello service has relative full functionality within Teams, it's a different story for Jira. In Teams, according to product head Steve Goldsmith, Atlassian's flagship product for developers only has surface-level functionality, meaning it's impossible to actually use the application as intended within the platform. Instead, Atlassian views its Jira integration in Teams as a way for the broader cohort to get updates on what is going on within the native app.

It gives "an ambient awareness" of what's happening, said Goldsmith. "It's not deep work, not super complicated manipulation of data structures. They are always the quick updates."

'It's like a bunch of raindrops'

Still, that's the goal with Salesforce's purchase of Slack: get onto every desktop within the enterprise and become the main collaboration platform across the company . Right now, Salesforce has apps for almost every department of a business, but it doesn't have one app everyone uses.

The benefits would be immense. Slack's many integrations could give Salesforce insight into complex workflows that could eventually help it inject more automation or otherwise improve productivity. Achieving that vision, however, requires substantial engineering work, which is one reason why analysts and investors are still questioning the $27.7 billion deal. Salesforce shares remain lower than they were before the acquisition was announced in December.

Even as Slack moves quickly to make sure it can capture even more of the everyday activity within an enterprise , there are inevitably going to be areas that the software can't touch — at least, right now. A customer, for example, may use Asana or Trello to track tasks, Zoom for video communication and Ironclad for contract management — along with hundreds, if not thousands of other vendors.

The collaboration market "is really a whole lot of submarkets," said Gartner analyst Craig Roth. "It's more like a bunch of raindrops on the window and they start connecting up to form bigger blobs."

Microsoft is taking the same approach. Workboard, for example, has several key features that run seamlessly in Teams. Now, the two companies have started selling a joint product offering. Microsoft also has a close relationship with Adobe Sign , which has alleviated the immediate need for the company to build or purchase its own e-signature technology. And aspects of the tech giant's recently unveiled Viva product suite are, in part, based on information that flows from Zoom, Workday and SAP.

But even those arrangements will require significant engineering work to get to that holy grail of full functionality within a platform like Teams, experts say. It's one reason why Microsoft is pitching Teams as providing the social and collaboration features for those third-party applications.

"Our partners want to leverage that versus building it themselves," Herskowitz said.

It may be that the lofty vision of being the all-day, all-in-one enterprise app proves to just be marketing hype. And it may also be enough for Slack and Teams to be the preferred point of integration for disparate workplace apps.

But it's clear Microsoft and Salesforce have grander ambitions for those products, and equally clear that application providers see one all-encompassing collaboration platform as an impossible goal.

The question now becomes how long Microsoft and Salesforce will stay willing to meet customers where they are — or, by leveraging their popular apps, drag them to their preferred terrain.

Fintech

Judge Zia Faruqui is trying to teach you crypto, one ‘SNL’ reference at a time

His decisions on major cryptocurrency cases have quoted "The Big Lebowski," "SNL," and "Dr. Strangelove." That’s because he wants you — yes, you — to read them.

The ways Zia Faruqui (right) has weighed on cases that have come before him can give lawyers clues as to what legal frameworks will pass muster.

Photo: Carolyn Van Houten/The Washington Post via Getty Images

“Cryptocurrency and related software analytics tools are ‘The wave of the future, Dude. One hundred percent electronic.’”

That’s not a quote from "The Big Lebowski" — at least, not directly. It’s a quote from a Washington, D.C., district court memorandum opinion on the role cryptocurrency analytics tools can play in government investigations. The author is Magistrate Judge Zia Faruqui.

Keep Reading Show less
Veronica Irwin

Veronica Irwin (@vronirwin) is a San Francisco-based reporter at Protocol covering fintech. Previously she was at the San Francisco Examiner, covering tech from a hyper-local angle. Before that, her byline was featured in SF Weekly, The Nation, Techworker, Ms. Magazine and The Frisc.

The financial technology transformation is driving competition, creating consumer choice, and shaping the future of finance. Hear from seven fintech leaders who are reshaping the future of finance, and join the inaugural Financial Technology Association Fintech Summit to learn more .

Keep Reading Show less
FTA
The Financial Technology Association (FTA) represents industry leaders shaping the future of finance. We champion the power of technology-centered financial services and advocate for the modernization of financial regulation to support inclusion and responsible innovation.
Enterprise

AWS CEO: The cloud isn’t just about technology

As AWS preps for its annual re:Invent conference, Adam Selipsky talks product strategy, support for hybrid environments, and the value of the cloud in uncertain economic times.

Photo: Noah Berger/Getty Images for Amazon Web Services

AWS is gearing up for re:Invent, its annual cloud computing conference where announcements this year are expected to focus on its end-to-end data strategy and delivering new industry-specific services.

It will be the second re:Invent with CEO Adam Selipsky as leader of the industry’s largest cloud provider after his return last year to AWS from data visualization company Tableau Software.

Keep Reading Show less
Donna Goodison

Donna Goodison ( @dgoodison ) is Protocol's senior reporter focusing on enterprise infrastructure technology, from the 'Big 3' cloud computing providers to data centers. She previously covered the public cloud at CRN after 15 years as a business reporter for the Boston Herald. Based in Massachusetts, she also has worked as a Boston Globe freelancer, business reporter at the Boston Business Journal and real estate reporter at Banker & Tradesman after toiling at weekly newspapers.

Image: Protocol

We launched Protocol in February 2020 to cover the evolving power center of tech. It is with deep sadness that just under three years later, we are winding down the publication.

As of today, we will not publish any more stories. All of our newsletters, apart from our flagship, Source Code, will no longer be sent. Source Code will be published and sent for the next few weeks, but it will also close down in December.

Keep Reading Show less
Bennett Richardson

Bennett Richardson ( @bennettrich ) is the president of Protocol. Prior to joining Protocol in 2019, Bennett was executive director of global strategic partnerships at POLITICO, where he led strategic growth efforts including POLITICO's European expansion in Brussels and POLITICO's creative agency POLITICO Focus during his six years with the company. Prior to POLITICO, Bennett was co-founder and CMO of Hinge, the mobile dating company recently acquired by Match Group. Bennett began his career in digital and social brand marketing working with major brands across tech, energy, and health care at leading marketing and communications agencies including Edelman and GMMB. Bennett is originally from Portland, Maine, and received his bachelor's degree from Colgate University.

Enterprise

Why large enterprises struggle to find suitable platforms for MLops

As companies expand their use of AI beyond running just a few machine learning models, and as larger enterprises go from deploying hundreds of models to thousands and even millions of models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

As companies expand their use of AI beyond running just a few machine learning models, ML practitioners say that they have yet to find what they need from prepackaged MLops systems.

Photo: artpartner-images via Getty Images

On any given day, Lily AI runs hundreds of machine learning models using computer vision and natural language processing that are customized for its retail and ecommerce clients to make website product recommendations, forecast demand, and plan merchandising. But this spring when the company was in the market for a machine learning operations platform to manage its expanding model roster, it wasn’t easy to find a suitable off-the-shelf system that could handle such a large number of models in deployment while also meeting other criteria.

Some MLops platforms are not well-suited for maintaining even more than 10 machine learning models when it comes to keeping track of data, navigating their user interfaces, or reporting capabilities, Matthew Nokleby, machine learning manager for Lily AI’s product intelligence team, told Protocol earlier this year. “The duct tape starts to show,” he said.

Keep Reading Show less
Kate Kaye

Kate Kaye is an award-winning multimedia reporter digging deep and telling print, digital and audio stories. She covers AI and data for Protocol. Her reporting on AI and tech ethics issues has been published in OneZero, Fast Company, MIT Technology Review, CityLab, Ad Age and Digiday and heard on NPR. Kate is the creator of RedTailMedia.org and is the author of "Campaign '08: A Turning Point for Digital Media," a book about how the 2008 presidential campaigns used digital media and data.

Latest Stories
Bulletins