Slack’s Biggest Rival Made A Costly Error

With the world being forced into isolation, it’s important that software such as Slack can allow businesses to function remotely, but sometimes things go wrong

When a devastating virus is ravaging the population and social isolation becomes our key weapon to combat it, it’s only natural that remote-working stocks surge in popularity. The likes of Slack (NYSE: WORK), Zoom (NASDAQ: ZM), and Teladoc (NYSE: TDOC) have experienced boosts at different points over the last month. 

Zoom stock alone has jumped more than 20% in the past month compared to the S&P 500’s (NYSEARCA: VOO) near 30% decline in the same period. 

With that in mind, it is important that these programs and products work when people need them the most, as they do now. Here at MyWallSt, we use Slack religiously, and with that very platform, a colleague of mine sent an article which showed that its arch-rival, Microsoft (NASDAQ: MSFT) ‘Teams’, had crashed. 

Is Microsoft Teams down? 

The popular workplace-collaboration software was down for more than four hours on Monday, 16 March, just when millions of workers across Europe needed it most. With much of the continent’s population (including yours truly) being forced into a remote work environment, it appears that Microsoft’s servers could not handle the explosion in usage. 

According to CNBC: “A spike in connectivity issues was seen at 9 am GMT as millions of Europeans tried to log on to work from home.”

More than 77% of the issues were reported to be server connection errors. Disgruntled workers, already forced to endure the horrors of working in proximity with their family and housemates for an extended period of time, took to social media to voice their concerns. One user Tweeted: 

“@MicrosoftTeams you had the weekend to prepare your servers. Now get back online.”

As of the time of writing, the error does appear to have been resolved. 

Good news for Slack? 

Although this might seem a minor inconvenience in the grand scheme of things, it is also a glowing endorsement of Slack, which appeared to have handled the influx of users without issue. 

The timing also couldn’t be better, with Slack enduring a hard drop last week following its earnings call, which beat on earnings but posted less-than-impressive guidance estimates. Of course, it is difficult for any company to post optimistic guidance in these trying times. 

As of October 2019, Slack boasted more than 12 million daily active users, as well as 6 million paying customers, of which nearly 700 are paying more than $100,000 a year, up 75% year on year. Microsoft Teams, on the other hand, has posed a significant threat, now boasting 20 million users, while other Big Tech rival Facebook (NASDAQ: FB) also saw its own workplace-collaboration program, Workplace, rise to 3 million users in October. 

Should I Invest In Slack? 

What this blunder shows us is that Slack can handle the heat of extreme usage, while Microsoft cannot. What it also suggests is that Teams has never had to deal with a large number of users on its software before, which begs the question: are people actually using Microsoft Teams, or is it just another part of the Office 365 package?

Back in November, Slack CEO Stewart Butterfield reinforced this notion, claiming that he knew of many Office 365 customers (of which Teams is a free add-on) also used Slack for their business. This is made possible too by the fact that Slack actually integrated with Office 365. 

As Slack continues to disrupt the workplace and how we do business with one another, it is worth noting that despite all the uncertainty right now, work as we know it is likely to change forever, and the likes of Slack could be at the forefront of this revolution.

MyWallSt operates a full disclosure policy. MyWallSt staff currently hold positions in Slack and Microsoft. Read our full disclosure policy here.