To clarify reports we’ve seen all over the place, IBM is outfitting the rest of its employees with the use of Slack’s collaboration software, not adding 350,000 new seats, as previously and ambiguously reported. Hours after the announcement of IBM choosing Slack to support its fleet of 350,000 employees, Slack stocks rose by more than 15 percent, following reports of the news. Today, Slack’s stocks have taken a near eight percent nosedive.
The collaboration company filed an official notice to shareholders, subsequently downplaying reports that would IBM adding 350,000 seats to its platform, choosing Slack over Microsoft Teams. Slack said in the SEC filing, “IBM has been Slack’s largest customer for several years now and has expanded its usage of Slack over that time.” The full statement from Slack’s filing is as follows:
“On February 10, 2020, a Business Insider article was published about Slack Technologies, Inc. (“Slack”). The article stated that International Business Machines Corporation (“IBM”) purchased Slack for all of its employees worldwide and further that IBM is Slack’s largest customer to date. IBM has been Slack’s largest customer for several years and has expanded its usage of Slack over that time. Slack is not updating its financial guidance for the fourth quarter of the fiscal year ended January 31, 2020, or for the fiscal year ended January 31, 2020.”
In an email statement to UC Today, Slack further clarified:
“A small group of 68 engineers within IBM started using Slack”
The company added, “In 2019, following the launch of Enterprise Grid, of which IBM was one of the first users, that number grew to from 165,000, to over 300,000 which was reported in a blog post. Today, Slack maintains, IBM has more than 300,000 users on the platform and will soon deploy Slack company-wide.
Slack has failed to make a profit, although it is doing well in the sales department. This has investors concerned about further loss from the collaboration company that markets itself as direct competition to Microsoft’s Teams offering. Since its IPO, the company’s had a rocky start, which could explain why investors were so keen on any good news from Slack.
Nevertheless, I wanted to gain some insight from industry analysts who follow the collaboration space, so I reached out to Patrick Watson, Senior Analyst, Cavell Group. He specializes in collaboration and customer engagement and told me, Slack and Microsoft aren’t in any real competition if you think about it.
“Microsoft Teams likely has more than 20 million daily active users, and it’ll probably announce 25 million daily active users soon. With Office 365 user counts at 200,000 million users worldwide it wouldn’t make sense for them to pay for additional collaboration software”
He added, “this is probably a very scary time for Slack.” Further expanding on the ‘mixup,’ Watson said, for Microsoft Teams and Cisco Webex Teams users, it just doesn’t make sense for them to spend extra money on Slack, which must have them worried because of the huge untapped market of non-Teams users who already have access to the platform if they want to make the switch for free.
