December 7, 2020

Microsoft Teams bet on files. Slack + Salesforce bet on data.

Are files or data the future of work?

by @maguay

Writer. Amateur photographer. Information architect. Frm. founding editor @racket and @capiche, senior writer @zapier, Mac and Web editor @AppStorm. Personal blog: @techinch.
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Listen to an audio take on this story on Capiche's SaaS Radio Hour.

“Software is dead,” declared Salesforce’s original marketing at the turn of the century. It was “the end of software,” software as we knew it anyhow, as the hopes and dreams of a generation went up in dot com bubble smoke. Maybe they were right; maybe software was dead.

Not that we’d quit telling computers how to work, as Wikipedia defines software. The death of software was the death of “the concept that you buy the software, that you own it, that you manage it,” Marc Benioff told tech reporter Steven Levy five years after Salesforce’s launch. Along with that, Salesforce heralded the death of files. All your business data was entries in a database table, presented through Salesforce’s UI. Files and backups were a thing of the past, along with boxed software and service pack upgrades.

A thousand kilometers away in Redmond, Microsoft near-monopoly was built on the opposite bet. To them, software—and especially software running on Windows PCs—reigned supreme. Web apps weren’t foreign to Microsoft; Hotmail’s acquisition in 1997 brought one of the earliest web apps into their fold. But their Office cash cow was built around files, around desktop software installed on PCs, with Exchange and Active Directory installed on internal servers, a web of Microsoft software holding your business together. The web, the information superhighway Bill Gates envisioned, tied your PCs together. It was the connective tissue, not the backend that powered software.

Computing was left with two models. You could buy software for hundreds of dollars, install it on individual PCs, and save data to files to share between PCs and bring your work with you. Or, you could subscribe to software in your browser for often dozens of dollars a month, share access to collaborate with others, and have your work available anywhere you could login from a browser.

The Salesforce model won. The vast majority of today’s software is subscription SaaS that runs in the browser. Where desktop apps are available, they’re an extra, a way to use the app offline and keep it in your dock. The primary app is a web-powered database. Even Microsoft adapted, building web app versions of Word, Excel, and PowerPoint, and bundling Office into a subscription.

Then along came something that actually could obsoletize software: Slack.

Slack: A modern terminal.

Slack modern software terminal

At first glance, Slack is just team chat, IRC with style, iMessage for teams, chat from the ‘90’s reinvented in purple. HipChat and Campfire had been around for years, as had Microsoft’s Skype and Lync. We’d seen this thing before.

But something was different this time. Slack wasn’t simply a bet on remote work and teams needing a virtual water cooler. It was yet another bet on the death of traditional software, and on the explosion of API-powered SaaS that needed a hub.

Slack’s chats are, in a way, atomized communications, conversations turned into an API. You type out a sentence or two and hit enter. Colleagues can reply—or, they can react with an emoji for a quick vote of confidence.

Then came the apps. The same way a colleague could send you a message, an app could send you data inside Slack. Someone just placed a new order, a Shopify integration might post in a sales channel, while a Gmail Zap or Help Scout integration might post Bob ( just emailed: "Help with password" in a support channel. It turned out, you didn’t have to keep all your software open all day. Apps could send you messages in Slack and let you know when new stuff was ready for action. And with smart integrations, you didn’t need to open the app then—you could react with an emoji to take action or send a message to the app from Slack to followup.

Slack, in many ways, became a modern Terminal.

Software started out text-driven, where you’d type mail -s "Hello world" to send Bob an email message. Slack brought things full circle, as a text-driven interface to your team and all of the software your team uses. When the majority of software you use is database-powered software that runs online, Slack can be the new interface to your data, a smarter notifications system for teams.

From the earliest days of Slack, their team was using it to manage help tickets and tweets, a hub of work around both the actual data and the conversations about it.

“Slack makes other software better,” their homepage says today. It’s where work happens, between people and software. You might still share files, but the work happens around individual bits of data, around pull requests and support tickets and tasks and new contacts.

That’s where Slack shines, and that’s what the CRM company that declared software dead paid $27.7 billion to acquire it two decades later.

Microsoft Teams: A modern file explorer.

Microsoft Teams file-centric chat

Microsoft adapted to the always-on, subscription-powered world where desktop software is an afterthought. It built web app versions of Word, Excel, and PowerPoint, transitioned Office to a subscription, and even de-emphasized Windows while bringing Office to iOS and Android. It’d built MSN Messenger into one of the most popular early chat apps, had Lync chat in Office for years, and had acquired chat tools inside LinkedIn and Skype.

So when Slack came on the scene, Microsoft in many ways already had chat covered.

What it didn’t have covered was a modern take on work, something that would pull everything together the way Slack did.

Thus Microsoft Teams, launched 4 years after Slack. In many ways, it was a clean start for the software giant, a new take on team communications.

But here, Microsoft had an ace up their sleeves: Office. The work they’d put into building Office for the web meant they could put Office inside anything. So in Teams, your communications would be organized by team with two primary tabs: Posts and Files.

You could chat about an idea, create a new Word document, and get your team to edit it all inside Teams. It became a new File Explore built for teams, a browser built around web apps. And that’s how many Teams integrations would work, too. You could push Slack-style bits of text into Teams, but the standard was set by Microsoft’s Office web apps, and most integrations would put their entire app into another Teams tab.

You could imagine a future where Teams was the interface to Microsoft’s software. Rather than Windows and a start menu, you’d have a conversation and tabs of apps, centered around files.

Files versus Data.

There are other takes on team chat. Basecamp centers chat around projects and tasks. Twist centers them around people, focusing more on conversations than the fleeting ideas and app chatter. Zoom centers on calls, with chat to fill in the gaps that speaking can’t cover. Google Chat centers on email, in a play closer to Microsoft Teams but built around Google’s web-first apps. Even Slack and Microsoft Teams compete on other areas, where Slack's a bet on positional software teams will pay more to use versus Microsoft Team's bet on a bundle of business software where you use the included option by default.

But for the things that go beyond chat, at least, it’s Microsoft versus Salesforce’s vision of the future that’s at stake.

Will the future of work continue to be centered around files, around documents and spreadsheets and work that is finished or nearly so, around full-screen apps and tabs?

Or will the future of work revolve one step up the stack, on the bits of data and info from apps before they’re pulled together into polished reports, on the notifications about changes and new customers and events and more that are the heartbeat behind data-driven apps?

Are files dead—or at least, is work around files dead, leaving files as the store of record, the finished output and not the way works’ done?

Salesforce and Slack and every other SaaS application in today’s business stack vote yes. And that determines the future of work.

Image Credit: Header based on photo by Martin Sanchez via Unsplash.

abbybarsky's avatar
@abbybarsky (replying to maguay )
2 years ago

Huh, I'm curious how many people don't keep their software open during the day. Slack is super powerful, but only to a certain extent. From user interviews for Cord, we're finding that in many roles (product, product marketing, customer success, data science, etc.), Slack is used for discussion, then they still have to go back into the software to make changes or continue their work. What does everyone else think?

I would argue that the future of work isn't files nor data, it's links to web apps. Files have became antiquated as people moved to web apps, and those web apps' UI are still critical to accessing, analyzing, and actioning the data that live within them. We actually already see this in Slack – many people posting links to web apps to ask questions, give feedback, or share information. Are other people seeing this in their workspaces?

4 points
maguay's avatar
@maguay (replying to @abbybarsky )
2 years ago

I think it's not as much people not keeping their software open during the day as it is the average team uses far more software than any one person should open and check daily. As a tiny example, say you're on an editorial team, you might open your email newsletter app on days you're sending out a newsletter—but you might want to keep track of new subscribers, and if that data's pouring into Slack, you don't have to open your email newsletter app daily.

And then, teams today use an incredible number of apps. One discussion had teams using from 19-150 SaaS applications, while another discussion had most people even individually using a dozen apps or so. There's no way to check that much software on a daily basis.

The future being built around links to web apps is fascinating—so then it's pairing data from the apps with links to go dig in and see more about the data. That absolutely could make sense, as you still need to open the app if you need to do more with that data.

2 points
MatheusPopst's avatar
@MatheusPopst (replying to @abbybarsky )
2 years ago

I read the other day an opinion that Slack is the 911 of business communications.

1 point
danieldcn's avatar
@danieldcn (replying to maguay )
2 years ago

I can't disagree more with this. Mostly because this draws a distinction between files and data, which to me is just data. a file is just a data structure around data. Spend time playing with Microsoft Graph the "raw" data experience is there.

1 point
maguay's avatar
@maguay (replying to @danieldcn )
2 years ago

I absolutely make have taken the idea too far :)

On one level, you can use both Slack and Teams in the same way. You can get individual bits of data—notifications, perhaps, would have been the better thing to focus on—in Teams, and you can absolutely share files inside Slack.

The big difference I was trying to parse with the difference between what I called "data" and "files" here was basically how where in the workflow you get notified and see the info in your chat, where many Slack integrations lean closer to being notifications for real-time updates on smaller things, while Teams feels focused more on sharing completed work in Office files. And then, if you dig into that a bit, Slack then either has you interact with the app through text/emoji-reaction based integrations, while Teams has these full app tabs where the whole app loads inside Teams and ends up treating it as a browser.

On the Microsoft Graph raw data experience: Have you been able to use that to build any unique workflows for your team in Microsoft Teams? That along with Microsoft Flow do point to a different future for Teams beyond pure Office files focus—you've got a great point there.

1 point
danieldcn's avatar
@danieldcn (replying to @maguay )
2 years ago

Ok, I think that elucidates the concept a bit better, and I'm happy to grant you the literary value of the statement since hey, it got me into the conversation ;). I have toyed with it, and I would also suggest that the difference between how one interacts with Slack versus teams depends a lot on knowing the plumbing of Microsoft and Teams, which is based on SharePoint, which is Based on .NET, which is based on the ideas of DCOM and COM and if you have no idea what I'm talking about in those last 2 technologies, The take away and the potential downside of teams is that the foundational basement of the tech is something like 20 years old. Often having the context of these foundations can acierate the ability to use and understand it. Whereas with Apps like slack the foundations are nice new, and often well illuminated in the brightness of modern and collaborative development paradigms. So all that to say, I think Microsoft Data comes with a lot more baggage, which should be expected. Overall though, I can see the SalesForce acquisition of Slack as SalesForce positioning themselves to be the fully modern competitor to Microsoft's slow moving re-imagining and refactoring of themselves. I don't think it's a bad thing, and I can imagine that SalesForce will go on a SaaS buying and consolidating effort to further strengthen the story around the enterprise. I know a lot of people seems to be upset about it, that SalesForce is a "boring" company, to that I say, well it's not like they got bough by SAP, or Computer Associates!

2 points
maguay's avatar
@maguay (replying to @danieldcn )
2 years ago

Haha, thank you!

What you mentioned in the history from Sharepoint to .net and beyond point to both the strength and weakness of Microsoft's products and platforms: Their support traces back so far that you can often do more with them but also may well find legacy cruft underneath. Windows for instance can still run even some Windows 95-era software (and some of the bundled tools have scarcely seen updates in decades); Macs do well to support a decade of software without updates. Legacy support versus clean slate starting over every so often.

Salesforce to a degree has a similar issue, where their CRM isn't as "modern" and "well designed" as newer competitors, but its basic design paired with a deep feature set makes it indispensable to enterprise who use it to build out custom solutions (and for whom a new design might break more things than it's worth). The eternal challenge of new versus old.

Any bets on what SaaS Salesforce will acquire next? They've got Quip which ... paired with Slack gives them a basic Office 365 competitor, interestingly enough. I do wonder if they'll pick up a file sync solution (Box?).

1 point
danieldcn's avatar
@danieldcn (replying to @maguay )
2 years ago

Box makes a lot of sense. I think DropBox is the losing solution when it comes to enterprise. Their attempt to diversify their offering seems to be obfuscated by what people perceive DropBox to be. "just cloud file storage", Box has the stronger focus on being file storage for enterprise and addressing the real enterprise data challenges, and they certainly have a more intuitive product working consistently across platforms. I'm thinking also a really strong SaaS integration tool like a Zapier.

1 point
maguay's avatar
@maguay (replying to @danieldcn )
2 years ago

Dropbox is frankly a sad story; Steve Jobs telling them Dropbox is just a feature has always stuck with me as instructive of how hard it is to compete with platforms. Box made it work by focusing on the enterprise, but as a consumer it's hard to not just switch to iCloud or Google Drive since I already use them through other apps.

On the integration side, Salesforce owns Mulesoft for the more general automation side, and Marketo for the marketing automation, so somehow I doubt they'd make another acquisition in that space, but who knows! The audience that uses Zaper does feel strongly different from the enterprise users that go for Mulesoft.

1 point
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