{"id":124283,"date":"2020-12-02T03:30:00","date_gmt":"2020-12-02T00:30:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/opinion-salesforces-deal-for-slack-creates-a-bigger-threat-to-microsoft\/"},"modified":"2020-12-02T03:30:00","modified_gmt":"2020-12-02T00:30:00","slug":"opinion-salesforces-deal-for-slack-creates-a-bigger-threat-to-microsoft","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/opinion-salesforces-deal-for-slack-creates-a-bigger-threat-to-microsoft\/","title":{"rendered":"#\n  Opinion: Salesforce\u2019s deal for Slack creates a bigger threat to Microsoft"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a40c46ec6e3c\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a40c46ec6e3c\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-salesforces-deal-for-slack-creates-a-bigger-threat-to-microsoft\/#Benioff_has_good_M_A_track_record_but_Slack_has_some_growth_issues_and_Salesforce_is_taking_on_huge_debt\" >Benioff has good M&amp;A track record, but Slack has some growth issues, and Salesforce is taking on huge debt<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-salesforces-deal-for-slack-creates-a-bigger-threat-to-microsoft\/#Salesforce_Chairman_and_CEO_Marc_Benioff_speaks_during_a_news_conference_in_Indianapolis_in_May_2019\" >Salesforce Chairman and CEO Marc Benioff speaks during a news conference in Indianapolis in May 2019.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/opinion-salesforces-deal-for-slack-creates-a-bigger-threat-to-microsoft\/#Therese_Poletti\" >Therese Poletti<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  Opinion: Salesforce\u2019s deal for Slack creates a bigger threat to Microsoft<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"Benioff_has_good_M_A_track_record_but_Slack_has_some_growth_issues_and_Salesforce_is_taking_on_huge_debt\"><\/span>\n  Benioff has good M&amp;A track record, but Slack has some growth issues, and Salesforce is taking on huge debt<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000085244\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div data-layout=\"inline\n              \" data-layout-mobile=\"\" class=\"\n        media-object\n        type-InsetMediaIllustration\n          inline\n  article__inset\n        article__inset--type-InsetMediaIllustration\n          article__inset--inline\n  \"><\/p>\n<figure class=\"\n        media-object-image\n        enlarge-image\n        renoImageFormat-\n        img-inline\n        article__inset__image\n      \" itemscope itemtype=\"http:\/\/schema.org\/ImageObject\"><\/p>\n<div style=\"padding-bottom:66.71875%;\" data-mobile-ratio=\"66.71875%\" data-layout-ratio=\"66.71875%\" data-subtype=\"\" class=\"image-container  responsive-media article__inset__image__image\">\n        <img decoding=\"async\" srcset=\"https:\/\/images.mktw.net\/im-266931?width=140&amp;size=1.4988290398126465 140w,\nhttps:\/\/images.mktw.net\/im-266931?width=540&amp;size=1.4988290398126465 540w,\nhttps:\/\/images.mktw.net\/im-266931?width=620&amp;size=1.4988290398126465 620w,\nhttps:\/\/images.mktw.net\/im-266931?width=700&amp;size=1.4988290398126465 700w,\nhttps:\/\/images.mktw.net\/im-266931?width=860&amp;size=1.4988290398126465 860w,\nhttps:\/\/images.mktw.net\/im-266931?width=1260&amp;size=1.4988290398126465 1260w\" sizes=\"(max-width: 140px) 100px,\n(max-width: 540px) 500px,\n(max-width: 620px) 580px,\n(max-width: 700px) 660px,\n(max-width: 860px) 820px,\n1260px\" src=\"https:\/\/images.mktw.net\/im-266931?width=620&amp;size=1.4988290398126465\" data-enlarge=\"https:\/\/images.mktw.net\/im-266931?width=1260&amp;size=1.4988290398126465\" alt=\"\" title=\"Salesforce Chairman and CEO Marc Benioff speaks during a news conference in Indianapolis in May...\"><\/div><figcaption class=\"wsj-article-caption article__inset__image__caption\" itemprop=\"caption\">\n<h4 class=\"wsj-article-caption-content\"><span class=\"ez-toc-section\" id=\"Salesforce_Chairman_and_CEO_Marc_Benioff_speaks_during_a_news_conference_in_Indianapolis_in_May_2019\"><\/span>Salesforce Chairman and CEO Marc Benioff speaks during a news conference in Indianapolis in May 2019. <span class=\"ez-toc-section-end\"><\/span><\/h4>\n<p>      <span class=\"wsj-article-credit article__inset__image__caption__credit\" itemprop=\"creator\"><br \/>\n            Associated Press<br \/>\n          <\/span><br \/>\n  <\/figcaption><\/figure>\n<\/div>\n<p>       With a $27.7 billion deal to buy Slack Technologies Inc.  \u2014  its biggest acquisition yet \u2014 Salesforce.com Inc. is poised to become an even bigger threat to Microsoft Corp. in the world of corporate software. But it could be its toughest merger yet.<\/p>\n<div class=\"paywall\">\n       As expected after reports emerged last week, Salesforce<br \/>\n        CRM,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/200515854\/composite\" class=\"negative\">-1.81%<\/bg-quote><br \/>\n       on Tuesday said it reached an agreement to buy Slack Technologies Inc.<br \/>\n        WORK,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/212180539\/composite\" class=\"positive\">+2.23%<\/bg-quote><br \/>\n       for $27.7 billion in cash and stock. Slack, which went public in 2019, is known for its corporate-focused instant-messaging system. The deal is expected to close in Salesforce\u2019s second quarter of fiscal 2022, which is next July.<\/p>\n<p> The deal will give Salesforce its biggest competitor yet to Microsoft, which offers the competing Teams messaging service. Salesforce said that combining its Customer360 platform with Slack will be \u201ctransformative for customers and the industry.\u201d<\/p>\n<p>Salesforce though, faces some pressure with this deal. Slack has been under serious recent pressure from the faster-growing Microsoft Teams, even as demand for both products has increased with more employees working from home during the pandemic.  <\/p>\n<p>\u201cTo illustrate [Slack\u2019s] plight, the company had 12 million daily active users (DAUs) as of Sept. 2019. Meanwhile, Teams overtook [Slack] with 13 million DAUs two months prior to that,\u201d Mizhou Securities analysts said in a recent client note. \u201c[Teams] has since exploded to over 75 million DAUs as of 4\/29\/20, and over 115 million  DAUs as of last month.\u201d Slack has not updated its daily active users since last fall, a move interpreted by many as a sign of weak growth.<\/p>\n<p>Evercore ISI Securities analyst Kirk Materne had similar thoughts.  \u201cThe problem is even with Salesforce\u2019s heft in the enterprise market, competing with Microsoft Teams in its core market is going to be extremely difficult, and convincing investors of the merits of this deal will be challenging,\u201d he wrote.  Materne also noted the deal may remove much of the goodwill Salesforce has with investors and create a new \u201coverhang\u201d on the stock.<\/p>\n<p>According to Salesforce founder and Chief Executive Marc Benioff,  the deal was brought to him by Slack CEO and co-founder Stewart Butterfield and Salesforce President Bret Taylor.  \u201cWhen they came to me and brought me this idea that Salesforce and Slack should come together, my eyes lit up.  I said \u2018This is the next generation of Customer 360,&#8217;\u201d Benioff said on a conference call Tuesday. \u201cThis is our ultimate vision of having this incredible user interface,  on top of all these services, through all these channels and all the collaboration on all these devices.\u201d<\/p>\n<p>Salesforce has developed its own collaboration tool called Chatter, which it shut down in 2018, a move some analysts believe was due to low adoption by customers. \u201cThere is no doubt that Slack just has an incredible <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>roach to collaboration in a way that we could never really have imagined,\u201d Benioff said when asked about Chatter.<\/p>\n<p>One analyst asked why Salesforce needed to spend $28 billion to buy the company, instead of forming a partnership. Benioff cited the company\u2019s past successes with larger mergers amid a slew of about 60 deals in the past few years. <\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>\u201cWe look at this and say this a <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/game\/\" data-internallinksmanager029f6b8e52c=\"7\" title=\"Game\" target=\"_blank\" rel=\"noopener\">game<\/a>-changer and we know how to pull it off,\u201d Benioff said. \u201cIt really means that we\u2019re able to do things with our <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a> that we could just not do as partners.\u201d<\/p>\n<p>Some on Wall Street, such as Dan Ives of Wedbush Securities, believe that Salesforce needs to continue to do big mergers to get ahead in the cloud sector.  \u201cIf Salesforce did no M&amp;A going forward, the company is still in the middle innings of penetrating the cloud shift,\u201d Ives said in a note.<\/p>\n<p>\u00a0Some investors are also likely to be concerned about the odd financing structure of the cash component of the deal, which calls for a bridge loan of $10 billion, with a  term of 364 days, although no analysts asked about the financing of the deal on the company\u2019s call.  Shares of Salesforce fell 4.25% in after-hours trading. <\/p>\n<p>For Benioff, completing this deal may also be a way of getting back at Microsoft, which bested its offer for the recruiting <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">social<\/a> network LinkedIn in 2016. Several years ago, Microsoft also was reportedly in talks to buy Salesforce, but those talks fell apart, <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.wsj.com\/articles\/with-slack-salesforce-would-put-heat-on-microsoft-11606418952\" class=\"icon none\">according to the Wall Street Journal.<\/a> And now Slack is being crushed by Microsoft. In July, <a rel=\"nofollow noopener noreferrer\" target=\"_blank\" href=\"https:\/\/www.wsj.com\/articles\/slack-files-eu-antitrust-complaint-against-microsoft-11595423056?mod=article_inline\" class=\"icon none\">Slack filed a complaint to the European Union<\/a> about the software giant\u2019s allegedly predatory behavior, contending it was using its dominance to gain users in Teams.  <\/p>\n<p>\u201cThis merger between Salesforce and Slack, like that between book publishers Simon &amp; Schuster and Bertelsmann, is fundamentally defensive, a result of a refusal of antitrust enforcers to enforce the law,\u201d Matt Stoller, director of research at the American Economic Liberties Project in Washington, said in a statement. \u201cSlack is trying to find a way to defend itself from Microsoft\u2019s underpricing and bundling of its Teams product.\u201d\u00a0<\/p>\n<p>Benioff also made much of his friendship with Slack\u2019s Butterfield and the proximity of the companies in San Francisco, where the Salesforce Tower is now the city\u2019s tallest skyscraper.<\/p>\n<p>\u201cThe Slack building is right next to my building, and I\u2019m looking into their building all the time,  Stewart is waiving at me and now I\u2019m waving at him and now we\u2019re giving each other big hugs when the pandemic is over,\u201d Benioff said.   <\/p>\n<p>Whether Salesforce will now be able to beat Microsoft at Slack\u2019s own game is a bigger question. <\/p>\n<\/p>\n<p><\/p>\n<\/p>\n<\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Therese Poletti\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Therese_Poletti\"><\/span>Therese Poletti<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. 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Associated Press With a $27.7 billion deal&#8230;<\/p>\n","protected":false},"author":1,"featured_media":124284,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-124283","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/124283","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=124283"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/124283\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/124284"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=124283"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=124283"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=124283"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}