Microsoft’s Growing Dominance in Enterprise Chat Could Topple Slack
Real-time chat applications have become increasingly ubiquitous in the workplace, offering more streamlined communications than spam-marred email, slow speeds or recipients dropped accidentally from threads.
While email remains the main method of enterprise communication by far, a new survey of more than 900 information technology decision-makers at companies in North America and Europe noted overall growth in the use of chat apps by businesses over the past two years, as well as a shift in their individual popularity.
Research conducted by Spiceworks, a professional network for the IT industry, found that in 2016 the dominant application was Skype for Business, followed by Google Hangouts, Slack and then the relative newcomer Microsoft Teams. Two years on, though, the landscape has altered.
New Survey Results Show Dramatic Changes
Earlier this month, Spiceworks published its latest survey results that show Skype for Business, owned by Microsoft, is still on top, with 44% of organizations using it, up from 36% in 2016. But Microsoft Teams has gained in popularity and is in use by 21% of companies, up from just 3% two years ago.
While use of Slack is still growing, used by 15% of businesses compared with 11% last survey, it has been pushed back to third place. Meanwhile, Google Hangouts usage dropped from 16% to 11%. Facebook has also entered the market, offering Workplace by Facebook, but it has not so far taken off and is currently only used by 1% of organizations.
Overall use of the applications shows growth across all sizes of company. The latest survey found that 58% of small businesses (up to 99 staff) were using collaborative chat compared with 42% two years ago, 61% of medium-sized companies (100-499 employees) compared with 38% in 2016, and 70% of large businesses (more than 500 staff), up from 53% in the previous survey.
Part of the rise in popularity in Microsoft Teams can be attributed to the fact that it is offered free to all users of the Office 365 suite of software, which is widely used in business and, according to the company, has more than 100 million monthly active commercial users. In July, it launched a free version to draw in users beyond its Office 365 subscriber base.
Slack, however, which largely defined the market in earlier years with its cool appeal and “email killer” hype, offers a free version, although it has limited functionality. Users need to upgrade to a monthly subscription version to access its full package. It claims to have eight million daily active users, but only three million are on the paid-for version.
Despite the drop in appeal of Google Hangouts, part of the G Suite offering, it saw a rise in use in large companies, growing to 18% from 11%, while Slack was most popular in small companies and was rated most highly for its innovation. Teams and Skype for Business scored highly for security.
Chat is No Clear Threat to Email
Opinion was clear among the IT professionals surveyed that chat apps, while highly important to the functioning of their organizations, were not expected to replace email in the workplace.
“Chat is fun and a great way to clean up your email inbox but it’s definitely supplemental,” commented one Spiceworks user. “Its focus is also almost entirely internal; you aren’t going to have a client send you files or messages on Skype or Teams.”
Looking ahead, Microsoft Teams looks set to grow further, with 41% of the organizations surveyed expecting to use it by 2020. Microsoft, which bought Skype for $8.5 billion in 2011, has stated it plans to integrate its communications capabilities into Teams, meaning Skype for Business will take a backseat, and existing customers will need to transition to Teams.
“We’ll bring the key set of Skype for Business capabilities in Office 365 into Teams over time along with new voice, video, and meetings innovation. Customers can choose to migrate Skype for Business users when the capabilities meet their requirements,” Microsoft said.
“Supported by the new Skype back-end infrastructure, Teams is built for the cloud on a highly scalable microservices architecture that’s efficient in bandwidth consumption, provides more robust telemetry, and enables maintenance and upgrades with minimal disruption.”
With Slack planning an initial public offering next year following a valuation of $7.1 billion in August, it will have to find a way to fight back against Microsoft’s growing dominance if it is to remain a contender.
