Slack and Amazon recently announced a significant partnership where Slack will power its voice and video infrastructure with Amazon Chime. This deal is significant for several reasons — on the surface, it will help Slack enable video calls on mobile and provide text transcription. But digging deeper, it’s clear that a robust calling investment is critical in driving Slack’s growth and adoption.
Voice and video calls have become essential to organizations while employees work from home during the pandemic. Zoom became a household brand overnight, driven by record 169% year-over-year growth over the past quarter.
Slack has also seen record-level customer adoption, adding 12,000 net new paying customers over the past quarter, driven largely by the need for teams to collaborate while being distributed. This exceptional growth supports the notion that channel-based communication is significantly better suited to remote work than email because it enables both real-time conversation and the slower back-and-forth cadence that email offers.
But Microsoft Teams has the unique advantage of blending video and voice calls with chat. The growth that is split by Zoom and Slack, Microsoft Teams is able to capture completely.
Slack’s partnership with Amazon Chime makes sense for both parties. Chime has underinvested in its user interface, while Slack has not invested deeply in calling to date. By joining forces, Slack can shift its focus to product and user experience around voice and video while offloading infrastructure, an area where Amazon already has deep expertise with its AWS technology. Slack can finally start to reap the benefits by going deeper in one of the most critical aspects of remote workplace collaboration: virtual meetings.
Meetings are foundational to remote-based collaboration
As much as channel-based communication can replace critical parts of email, it can’t entirely replace meetings. It can certainly help reduce them, but meetings are still at the heart of synchronous collaboration for organizations—that is true whether teams are working in the office together, or remotely from their own homes.
While email has historically been the technological backbone that drives work, Slack chipped away at that notion over the past few years. However, this pandemic is showing us that more than email, and potentially more than channel-based communication, calling is the piece of technology that organizations need the most in a distributed workforce.The moment everyone started working from home, they quickly realized that email is not ideal, and there needs to be a better way. But the ability to effectively connect in real time over voice and video was essential.
At the end of the day, meetings have to be a fundamental part of any strategy for a workplace collaboration product like Slack. To date, Slack has chosen to invest lightly in calling, opting to focus more energy on partnering with third-party products so organizations can choose whichever product works best for them. In doing so, Slack has been forced to share growth that could have been theirs with their partners. Investing more heavily in native calling would allow Slack to capture some of that growth for themselves.
Meetings build a viral growth component into the product
There are other advantages to having a native calling feature that works well with meetings. When hosting a virtual external meeting, all customers, sales leads, vendors, and other partners are forced to join the call on the host’s meeting platform.
For organizations that use Slack and host meetings with an external user on Zoom, Teams, Google Meet or Webex, that external user will never experience Slack. Slack won’t launch for them, nor will they have any idea that the people on the other end of the call are Slack users. In these situations, the video call platform gets the exposure, while Slack gets none.
For Microsoft Teams, however, Teams is the calling platform, so any external user joining the call gets to experience Teams. Creating awareness amongst users is the first step toward driving adoption. In this case, Microsoft isn’t just creating awareness, they are getting users that may have never used Teams to engage with the product. Good experiences in those meetings will leave users with a positive impression of Microsoft Teams.
For organizations that haven’t made the move to Slack or Teams, this exposure can be critical in getting them to take the first step to transitioning, especially when the need for this kind of a product is at an all-time high. Additionally, that transition may be easier to make from a financial perspective if that organization is already a Microsoft 365 subscriber.
There is some level of natural virality built into calling platforms, the impact of which is amplified in a completely remote working world. This is virality that Slack doesn’t get to take advantage of without a robust calling feature built in to its product.
Integrations and apps can extend calls and meetings even further
Over the long run, integrations are key. With thousands of third-party apps and hundreds of thousands of custom-built apps, Slack has established itself as the platform leader in the collaboration space. Users may initially come to Slack for an incredible channel-based communication experience, but they stick around because they move more work into Slack with apps, workflows, and integrations.
The challenge with a non-native calling strategy, however, is the inability for those apps to extend the meeting experience. While Zoom has recently invested in creating a platform for developers to build apps, those experiences live within Zoom. Apps built for Slack live within Slack. Connecting those two experiences to expand functionality with apps in meetings is complicated and would provide for a clunky user experience.
Within Microsoft Teams, calling and messaging is hosted under the same platform, making it easier for developers to build unified experiences that extend meetings. I have a window into this as the CEO and co-founder of Polly, an app that helps millions of users gather employee feedback in Slack and Microsoft Teams. Our data shows that over 40% of our customers in Microsoft Teams use apps in meetings. Users are looking to make work better through integrations, and a critical part of that work is meetings.
Slack is late to the party, but the party isn’t over
Despite Slack being first when it comes to modern workplace collaboration, Microsoft Teams has a head start when it comes to calling—a massive one. While it may appear that existing Microsoft 365 subscriptions are the primary driver of Teams’ user growth, the need for meetings and calls may have been a stronger driver these past three months.
However, as Slack CEO Stewart Butterfield mentioned Thursday in Slack’s earnings call, the magnitude of the changes this pandemic brought on “are just beginning to be felt.” We are still in the first half of the transition in how organizations communicate and collaborate. While so many organizations have embraced either Slack or Microsoft Teams recently, many, if not most, are still using email as their primary mode of internal communication.
If Slack is able to move quickly in integrating Chime, then all of these growth elements are within reach for Slack as well. Having robust calling features built into Slack makes it easier to acquire new customers, to leverage those customers to pull in other newer customers, and for developers to extend the capabilities of its platform.
Slack is clearly looking to add more functionality to calls, but over time, will Slack’s native calling compete with Zoom, Webex, and others? Will people use Slack to run meetings with external stakeholders, or just for quick ad-hoc calls? There are multiple ways to become the hub of workplace collaboration, and while having a rich native calling feature isn’t required to succeed and grow, it certainly makes the journey significantly easier.