Slack partners with Amazon to take on Microsoft Teams

Illustration by Alex Castro / The Verge

Slack is partnering with Amazon in a multiyear agreement that means all Amazon employees will be able to start using Slack. The deal comes just as Slack faces increased competition from Microsoft Teams, and it will also see Slack migrate its voice and video calling features over to Amazon’s Chime platform alongside a broader adoption of Amazon Web Services (AWS).

Amazon’s roll out of Slack to all of its employees is a big part of the deal, thanks to an enterprise-wide agreement. It’s not immediately clear how many of Amazon’s 840,000 employees will be using Slack, though. Up until today, Slack’s biggest customer has been IBM, which is rolling out Slack to its 350,000 employees.

While Slack has long used AWS to power parts of its chat app, it’s now committing to using Amazon’s cloud services as its preferred partner for storage, compute, database, security, analytics, machine learning, and future collaboration features. The deal means it’s unlikely we’ll see Slack turn to Microsoft’s Azure cloud services or Google Cloud to power parts of its service in the foreseeable future.

“We have not used Azure,” says Brad Armstrong, vice president of business and corporate development at Slack, in an interview with The Verge. “The vast majority of our service has always run on AWS.” Armstrong says it’s “not likely” that Slack will be looking to use Azure in the future.

Illustration by Alex Castro / The Verge

The move to Amazon Chime for Slack voice and video calls is also a significant part of the deal. Voice and videoconferencing is a particular weak point of Slack compared to Microsoft Teams, but this new integration should mean it will be vastly improved in the future. Slack has already started the migration, and it’s looking into new features. “For now, we’re just focused on shoring up the back end,” says Armstrong. “As Chime has additional features, we’re looking at bringing the mobile experience to include video, which it doesn’t today. We’re also looking at transcription.”

Slack and Amazon are also promising better product integration and interoperability for features like AWS Chatbot, a service that pushes out Slack channel alerts for AWS instances. In the coming months, Slack and AWS will improve its Amazon AppFlow integration to support bidirectional transfer of data between AWS services and Slack channels.

All of these integration points and Slack’s embrace of Amazon are designed to make the chat app far more appealing to enterprise customers. Slack has been steadily growing its enterprise business, despite Microsoft’s big push with Teams recently. It’s a point that CEO Stewart Butterfield has been keen to stress in recent interviews, even if he thinks Microsoft is “unhealthily preoccupied with killing” Slack.

“The future of enterprise software will be driven by the combination of cloud services and workstream collaboration tools,” says Butterfield in a statement today. “Strategically partnering with AWS allows both companies to scale to meet demand and deliver enterprise-grade offerings to our customers.”

It’s a deal that will benefit both Amazon and Slack. Amazon gets an important partner for AWS and its Chime platform, and Slack gets the reliability and security of AWS with a better voice and video calling service underpinning its service.

The partnership also speaks to the core of how Slack has managed to win businesses over. Slack has opted for partnerships and integrations with a variety of rival software and cloud providers, and hasn’t always attempted to build those features into its own app. Butterfield touched on the value of that integration in a wide-ranging interview on The Vergecast last month.

Slack’s main rival, Microsoft, is also trying to entice developers and improve app support in Microsoft Teams, but the company’s tightest integrations are still the Office suite of Outlook, Word, Excel, PowerPoint, and more. Microsoft has also been bundling Teams as part of its Office 365 subscription, tempting businesses to use the communications software over Slack and other rivals. Microsoft Teams hit 75 million daily active users recently, a huge jump from even the bump at the beginning of the pandemic.

Slack’s approach seems to be working, especially for businesses that aren’t as reliant on Microsoft’s productivity apps. Slack reported its earnings today, revealing more than 122,000 paid customers, an increase of 28 percent year over year. Over 750,000 organizations are now using a free or paid subscription plan, up from 660,000 at the end of the last quarter.

Butterfield describes Slack’s recent quarter as “phenomenal,” with 50 percent revenue growth year over year. Slack broke a user record in March, just as many businesses started to order employees to work from home amid the ongoing COVID-19 pandemic. “We believe the long-term impact the three months and counting of working from home will have on the way we work is of generational magnitude,” says Butterfield. “This will continue to catalyze adoption for the new category of channel-based messaging platforms we created and for which we are still the only enterprise-grade offering.”

Update, June 4th 5:55PM ET: Article updated with comments from an interview with Slack CEO.

Comments

Slack has to get bought out eventually right? Not sure how they can go again Microsoft alone. I’m betting it’s Google or Amazon.

I think the same, but its value has to be dropping while Teams (a non-competitor, per CEO) eats its lunch.

If a company did buy Slack it would be nice if it wasn’t one of the big tech companies. They just seem to own soo many things. Maybe like zoom?
Its also interesting how Microsoft has Teams and Skype like why not just put them together?

Skype for business is out of support next year. They don’t have a consumer teams yet.

yet…pretty sure that is going to be out at least in preview within a month or so

teams for consumers has already been announced, and is coming soon. Still, theres a free version so you can already just sign up and use it.

we use the free version at our company. plenty great for our needs as we have less than 100 employees (free Teams allows 300 users). free Slack is just awful and is just a teaser. You really can’t implement free Slack at an organization whereas free Teams can totally work with no limitations. you just don’t get admin controls, some apps, some features, scheduled meetings (can still do impromptu meetings).

It would be nice, but that’s not reality. Every industry is destined to be dominated by giants.

My understanding is that Skype for Business is at end-of-life. Teams doesn’t lend itself well for personal use, but it’s certainly possible.

lol…the consumer version of Skype has become so God-awful I would gladly use Teams instead.

Teams is fantastic for personal use. Why do you say it’s not?

Yeah, I’m not sure Teams is eating anything honestly. Only reason it’s relevant, is MS has been shoving it down the throats of anyone who pays for O365. I’m in EDU and not long ago, Teams was self installing constantly. You had to jump through hoops to turn it off, remove it from the machine. Otherwise it would continue every time you restarted. Thats not how you do things.

Teams is good, Slack is better IMO. I’ve used both. Started with Teams, ended up going Slack. More integrations, simpler/easier to use and it worked with Google Shared drives. Teams at the time, did not. They each have their niche. Pick the one that works for your setup. Want free? Go Teams! Again, EDU here and we basically get Slack for super cheap.

So you don’t like Teams because it didn’t have as good of Google Drive integration as Slack? Yeah, if you’re heavily invested in G-Suite you probably wouldn’t pick Teams but using the Office 365 suite including Teams offers much better integration and just a better overall experience than using G-Suite with Slack. Teams is definitely eating Slack because any organization heavily invested in the Office Suite, which is most companies, inevitably finds that they are much better served by Teams than Slack.

I suspect that in two years, Slack will be as influential as DropBox is today. That doesn’t mean they won’t matter, just means they won’t matter nearly as much.

your knowledge on Teams is kind of outdated. and that’s the thing. Teams is improving much faster than Slack

Their product is better than Teams in what it actually does? Dropbox is also going up against MS and seems to be doing okay

Yup, Microsoft is going after them too. I honestly might leave Dropbox and go Microsoft 365 because of that new family plan.

It doesn’t seem like a reciprocal business arrangement…

I mean, has anyone at Slack ever even used Chime for a voice/video call?

Amazon Chime is not better than Microsoft’s video and chat service. Slack is going to have to accept like Google Docs accepted that they might have a piece of the pie but Microsoft basically owns the pie. Microsoft is the most battle tested company in tech. Bigger and better companies have tried before to take on one of their core divisions. They are still bigger, better, stronger and richer than all of them except Apple.

To be honest, none of those things really matters when you shoot your own foot. Which is why Slack is still growing and eating some of MS’s pie. Sharepoint/Teams as a whole should have already won this battle years ago but their internal incompetence has left the door open for competitors. What does matter now is that Teams is free with O365 and it has native integration with Office. If this wasn’t the case I don’t really think they will have significant market share outside of compilance orgs.

Somewhat more on topic: enterprise-wise, the leaders are zoom or webex for teleconference. So this is also another area MS have every reason to dominate but failed badly. So maybe you’re right, those things do matter, but clearly Microsoft is far from "better" than anyone in these categories.

Funny, I have yet to see Zoom used for any external vendor meetings I’ve had since this whole thing started. I’m sure they’re out there but my company is primarily WebEx for video conferencing and the outside company meetings I’ve had have mostly been in Teams or GoToMeeting of all things. The only thing I’ve been on Zoom for are a couple essentially one-way webinars.

All are decent, but I have been surprised how little Zoom I’ve seen. For our company it’ isn’t surprising though, since Zoom has been disallowed from internal use by our ISO forever even before all of the security issues were publicly reported.

In my anecdotal experience, zoom or webex have been used for every single teleconference meeting I’ve been in, Skype for none.

For me it’d been 50% Zoom, 30% Teams and 20% Google (whatever they’re calling it now). I haven’t been on a single Webex call in years (and thankful I am for that)

webex used to be almost all my calls, with some skype. it did shift slowly since webex became complacent and charged higher prices. the general trend to squeeze IT left them wide open from other newcomers like zoom. they’re still big with certain types of organizations that have more uhh headroom with IT budgets.

It seems like you are conflating "leaders", as an in most used, with "better". To say that WebEx is better than any other video conferencing software is nuts. It is so bad that I am baffled to continue to see it be used by anyone. The only time I ever see WebEx used is on TV and it always stutters, degrades, and garbles during the interview.

Zoom works well for video calls but that is all it does. Teams works really well as a phone system and for video calls. I’ve heard that Slack supports video calls but I’ve never actually seen it in use. Hangouts/Meet/whatever Google calls it this week works fine for basic video calls as well although the companies that used to use it to schedule meetings with us at work have almost all switched to Zoom now.

That’s the landscape I’ve seen.

Slack video is… not great. I think that’s why they’re teaming with Amazon.

I’m not sure if you are proving my point or what, but MS does not have a solution that is better than Zoom and what most people use Zoom for, you basically said this. Nobody use dedicated video phone systems this day and age.

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