The Enterprise Messaging Wars are Only Just Beginning

Following Atlassian’s capitulation to Slack, a headline on Wired.com proclaimed "The Office-Messaging Wars Are Over. Slack Has Won."

While Slack may have won the Office Messaging Wars of 2014-2017, the Enterprise Messaging Wars of 2018-2020 are only just beginning.

Get your popcorn bowls out

The prize will be dominance in the multi-billion enterprise collaboration market.

Today, only a tiny fraction of the 230 million knowledge workers worldwide use persistent group chat in the workplace.

In almost all industries beyond tech - like academia, government, and retail – the migration from legacy IM systems like Skype for Business and Jabber is in its infancy.

We’re only in episode 5 of 20 in The Game of Messaging Thrones. Slack’s acquisition of Hipchat and Stride is more like an intriguing plot twist than the long-awaited season finale.

We should all settle in with our popcorn bowls because - with the arrival of Microsoft, Google, and Cisco on Slack’s home turf – things are about to get even more heated.

In early 2017, the battleground for enterprise messaging shifted from signing up Silicon Valley startups for a few dollars per month to multi-million dollar enterprise contracts with large companies like IBM, Oracle, and Ford.

By establishing a premium price point for Enterprise Grid, Slack has placed its bet that the devotion of its loving users will overcome its competitors’ strategy of bundling messaging for free with Office 365, G Suite and Webex.

While Slack, Microsoft, Google, and Cisco each made headway in appealing to the enterprise market, Atlassian was investing in rebuilding HipChat from the ground up.

In doing so, Atlassian made a strategic decision to focus on the messaging needs of its existing Jira, Confluence and Bitbucket customer base.

By design, Stride wasn’t built for enterprise customers.

Ultimately, as the battleground shifted to winning large enterprise customers, this decision left Atlassian without a horse in the race.

The battle among Teams

Both Microsoft and Cisco have established a strong foothold in the enterprise market segment simply by converting Skype for Business and Webex users to Microsoft Teams and Webex Teams respectively.

According to a report by research-advisory firm Nemertes in June 2018, 33% of companies using collaborative apps are already using Microsoft Teams, and 22% are using Cisco’s offering.

With another 25% of the market going to several other players like Workplace from Meta, RingCentral, CA, and Zoho, the enterprise messaging market is likely to be perpetually fragmented.

These days, a decent persistent group chat application is table stakes for any serious enterprise collaboration suite or video conferencing solution.

The consensus is that, at least for now, Slack’s user experience remains superior.

Nonetheless, following a rush of recent upgrades, Microsoft Teams, Hangouts Chat, and Webex Teams are perceived as “good enough” for many teams.

The features that matter most to enterprise IT decision-makers don’t make for a great Silicon Valley cover story: security, data loss prevention, and e-discovery.

Importantly, Microsoft, Google, and Cisco bring strong enterprise security credentials. Besides, it’s difficult to argue with “free”.

Users love Slack. IT decision-makers are finding that Slack’s devoted following often refuse to migrate to the free alternatives offered by Microsoft, Cisco and Google.

It is, therefore, likely that Slack will continue to announce flagship enterprise customers in advance of its IPO, which most commentators believe will happen in 2019.

Meanwhile, Microsoft and Google are likely to continue migrating Office, and G Suite customers en masse to Microsoft Teams and Google Chat.

Given these dynamics, enterprise messaging is unlikely to be a winner-takes-all market.

Co-existence & chat app interoperability

Increasingly, given these pricing dynamics, CIO’s are concluding the only viable outcome is peaceful co-existence with Slack (for those employees who need/want it most) running alongside either Microsoft Teams, Google Chat Chat or Webex Teams (for everyone else).

‍Mio makes Google Chat, Slack, and Microsoft Teams fully interoperable. We are working with the world’s largest enterprise messaging customers to ensure employees using one messaging app, like Slack, can communicate seamlessly with users on other messaging apps, like Google Chat or Microsoft Teams.

As Microsoft, Google and Cisco pick up the baton from Atlassian, messaging interoperability has never been more important.

At the time of reading, we have now hit roughly episode 8 of Game of Messaging Thrones. Momentum is building all the time.

Through the power of the cloud, these collaboration apps are constantly innovating:

• Microsoft Teams now has 145 daily active users
• Cisco just introduced cognitive collaboration into Webex Teams
• Slack announced 12m daily active users and have just added Enterprise Key Management

Read Next: Dominic Kent updates with the next installment of this collaboration saga.