Slack CEO says Microsoft is “trying to crush us”

by Surur
July 25, 2020

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A few days ago Slack finally did what they have been threatening to do for a long time now – file an antitrust complaint with the European Commission against Microsoft for bundling Microsoft Teams with Office 365.

The move has been interpreted as being born out of desperation by many, with The Motley Fool, for example, asking if “Slack Admit Defeat by Filing Antitrust Claims Against Microsoft?” and ZDNet saying “Sorry, Slack, your complaint is a joke.

According to Slack CEO Steward Butterfield however Slack is making the complaint out of a position of strength, saying: “Over 3+ years since Teams was announced, we’ve grown >500% (our enterprise business grew >1,100%). We continue to win with the biggest companies in the world. We’ve lost 0% of our 100 largest customers.

He also insisted that market leaders chose Slack, not Teams.

He, however, claimed that Microsoft bundling Teams for free with Microsoft 365 was limiting the company’s growth, and that Microsoft used a large number of other underhanded techniques in addition, saying: “… there’s no question we’d be growing even faster without the world’s biggest software co trying to crush us.

Butterfield complained that “Teams is given away for free, bundled with O365. Skype for Business users are being force-migrated. It’s impossible to avoid, turned on by default. Pre-installed (and if you delete it, automatically reinstalled). Priced at zero + “anything goes” to get distribution = Not allowed.

In their official statement, Slack said “Microsoft has illegally tied its Teams product into its market-dominant Office productivity suite, force installing it for millions, blocking its removal, and hiding the true cost to enterprise customers.”

Butterfield said this was a textbook example of anti-competitive behaviour and that he was “confident the Commission will pursue the investigation and find Microsoft in violation.

Slack is demanding that Microsoft sell Microsoft Teams separately to enterprise customers.

Butterfield insisted it was his duty towards customers, employees and shareholders to make the complaint, but in the court of public opinion, his claims have been undermined by years of bravado in the face of the threat, starting famously with his full-page newspaper ad in the New York Times welcoming Microsoft, saying they were “genuinely excited to have some competition” and as recently as last year saying they were confident of beating Microsoft.

He also said that Microsoft Teams is “not competitive” with Slack and that the two products were “fundamentally different”, portraying Teams as mostly a video conferencing platform while Slack was a channel-based communication medium designed to replace email. This would seem to suggest that companies which needed what Slack has to offer would seek them out.

Of course, the actual case will be litigated in front of the European Competition Commission with more complex arguments than that, but when this slow process concludes, possible before 2030, most companies would have already decided which product is the actual future of enterprise collaboration.

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