This year, Microsoft announced that the number of active daily users of Teams had hit 13 million1, outpacing Slack just two years after launch. Teams achieved a 21% share of the collaboration market by the end of 2018, and is predicted to hit 41% by the end of 20202
So, what lies behind this rapid and continued growth? What has Microsoft Teams got to offer that their competitors don’t? In this blog we’ll explore the reason for growth in the market and how Microsoft are positioning themselves to become the market leader – despite being a few years late to the party.
The market for collaboration tools is increasing
Team messaging, business chat, collaboration apps etc, there is no doubting the scale of the impact a certain type of business communications platform has had in recent years.
In fact, 80% of businesses now use some sort of ‘social’ digital tools to aid better collaboration between colleagues3. Apps marketed specifically for teamwork and collaboration represent the fastest growing communications technology segment, with the market expected to expand by 9% worldwide this year to reach a value of $45 billion.
But why? The rationale is simple; on the back of trends such as increasingly flexible working patterns and dispersed workforces, these tools help colleagues stay in touch and collaborate more effectively wherever they happen to be courtesy of a single-pane-of-glass, cloud-based solution that combines instant messaging, group chat, file sharing, document editing, scheduling and calendar tools, voice and video conferencing.
In turn, there are some big business benefits;
- It estimates that the impact could be as much as a 20-30% increase in productivity.
- Nearly three-quarters (70%) of employees say they are able to collaborate better with colleagues because of digital technology4
- The use of such apps has been linked to improvements in retention rates and worker satisfaction.
The changing world of work means the traditional 9-5 is long gone, businesses must embrace the change and prepare to enable efficient and productive communication.
Teams players – who else is in the market?
Worldwide, there are numerous brands contributing to the rapid growth of the collaboration app segment. You might have heard of; Slack, Google Hangouts and Facebook Workplace package multi-channel communications in interfaces that borrow heavily from social media.
But Microsoft Teams looks en route to eclipse them all. Only launched in 2017, Microsoft has now focussed on the team chat/collaboration space, but in the meantime ceding a full three years to Slack and the standalone version of Google Hangouts, which both appeared in 2014. But the story since has been a seemingly unstoppable rise to prominence. There is every reason to believe that, even as the collaboration platform market as a whole continues to grow, Teams will end up with a market share well above the 41% predicted by Spiceworks.
Why are businesses choosing Microsoft Teams?
Teams seems to have struck gold with a model that really appeals to the modern-day business user – communications as an integral part of your broader IT assets, not as something separate.
Convenience: Teams forms part of the Office 365 cloud business suite. Providing a ready-to-go teamwork solution with a core set of tools that can be accessed from within other Office 365 apps, offering the convenience of communications as you work. Microsoft has been very careful not only to integrate Teams very closely with all the other applications available when you sign up for Office 365, it has also very intentionally leveraged Office 365’s popularity to drive adoption.
It’s free to use: If you are an Office 365 business subscriber with fewer than 1500 employees, you effectively get Teams as a free bolt-on to your existing package. This is a marked departure for Microsoft, which marketed its previous business communications solutions – Lync and then Skype for Business – as distinct, paid-for platforms.
The future of collaboration: Telephony
It’s no coincidence that the online version of Skype for Business currently available as part of the Office 365 suite will be discontinued after July 2021. From that date, all Skype for Business Online users will be migrated over to Teams (see blog). This not only represents a potentially big leap in active users for Microsoft’s latest flagship communications app, it also signals its vision for placing collaboration at the centre of a broader communications picture.
Long term, Microsoft’s vision for Teams appears to be to draw together the different strands of communication and collaboration – messaging and calling, document sharing and editing, scheduling and project management – with a set of best-in-class tools all made available within a single platform (and therefore across its Office 365 business cloud suite). The final piece in this jigsaw is telephony.
For all the innovation around HD video conferencing, instant messaging and collaboration platforms, telephone still stands out as the single most important mode of communication for businesses. Two thirds of people (65%) still prefer to contact a business via telephone5. A similar proportion of businesses (64%) believe customers should always have the option to speak directly to a live agent, while 60% still rank phone systems as their number one communications investment priority.
Like nearly all modern communications and collaboration platforms for business, Teams allows users to make in-app voice calls to other users. With the Phone System extension also known as “Business Voice” for SME/SMB, it also offers an IP-based external telephony management service complete with enterprise-class call handling and PBX capabilities, including features like voicemail, call history, hold/resume, speed dial, call transfer and forwarding, caller ID masking and many more. These functions can be accessed via the ‘softphone’ built into the app, or by connecting an external VoIP-capable telephone end point. To make calls, Teams subscribers can either buy a Calling Plan from Microsoft, or use the Direct Routing feature to choose a third party operator.
With the introduction of business-class telephone solutions, we can see clearly how Teams is crossing the divide between internal, collaboration-based communication and external, customer-facing comms. Internet or IP-based telephony, also known as voice-over-IP or VoIP, is undoubtedly the future of the telephone. By 2025, for example, BT will switch off all of its existing landline PSTN and ISDN services in the UK, making IP-based services the default option. The reasons are down to plain economics – VoIP telephony can be significantly cheaper to run than traditional landline and it is much easier and quicker to set up new lines, making it much more scalable.
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References/Sources: 1. https://www.computerworld.com/article/3408781/microsoft-teams-now-has-13m-daily-active-users-outpacing-rival-slack.html 2. https://www.zdnet.com/article/microsoft-teams-is-killing-it-in-the-business-chat-market/ 3. https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/how-social-tools-can-reshape-the-organization 4. https://news.arubanetworks.com/press-release/beyond-productivity-human-side-digital-workplace-quantified 5. https://financesonline.com/business-phone-systems-statistics-analysis-of-trends-data-and-market-share