Microsoft just brought back the Bill Gates era with its new plan to take down Slack
Earlier this year, it was reported that Gates urged company leadership not to bid $8 billion for mega-hot Silicon Valley startup Slack, but rather reinvest in building out the business appeal of Skype, which it bought for $8.5 billion in 2011.
It seems that Microsoft took Gates' advice: According to a leak in September 2016, Microsoft experimented with calling the new product "Skype Teams," before settling on the apparently final name of just "Teams."
Really, though, even without that indicator, Microsoft Teams is so much like Bill Gates, he may as well have signed it. In fact, Microsoft Teams is itself the most Gates-esque move yet undertaken by Microsoft under Nadella's reign, aimed entirely at using Microsoft's sheer size and scale to edge out the competition.
Gates of Borg
Back in the '90s, before memes were really a thing, it was kind of a meme to pass around pictures of then-Microsoft CEO Bill Gates as a Borg - the cyborg baddies of "Star Trek: The Next Generation" fame.
If you're not a "Star Trek" fan, trust me, it's a sick own. Before the Borg attacked, they would issue their famous warning: "Your biological and technological distinctiveness will be added to our own. Resistance is futile."
It was a warning that resonated with the tech industry of the day.
Under Gates' leadership, Microsoft became known as a company that would win at any cost. From productivity apps to web browsers, any competitor it couldn't simply buy Microsoft would crush by making a new, competing product and win by selling to its huge existing customer base.
This is exactly what Microsoft is doing with Teams. Rather than pay $8 billion for Slack, which is more than twice its last private valuation of $3.8 billion, Microsoft has opted to take a bunch of technology and talent it already has and build a juggernaut that can't be stopped.
Everywhere already
Microsoft's Office 365 subscription suite has 85 million monthly active users, all paying workplace customers, and all of whom will get access to Microsoft Teams when it leaves preview and officially launches next year.
That's a tremendous advantage for Teams, giving it a reach that other companies will have trouble matching. Plus, Microsoft already has important stuff like security and regulatory compliance at huge scales all sorted out, solving what's historically a huge headache for startups as they learn to sell to Fortune 500 companies.
Just as importantly, Teams boasts tight integrations with the whole Microsoft Office suite, which is already the standard for getting work done.
In the days of Gates, Microsoft's killer edge was what's called the "platform advantage." Microsoft's ownership of Windows and Office, the two main ways that people got anything done on a PC in those days, made it really easy to integrate any new product in a deeper and easier-to-use way than any competitor possibly could.
While Slack has accrued a vital ecosystem of developers around itself, supporting software and chatbots that integrate with the app, it's hard to compete with a product that's built around Office and the whole Microsoft product lineup.
In other words, Microsoft has weaponized Office into something that no startup can compete with head-on. The whole point of work chat apps is to collaborate on documents and projects, and Microsoft owns a huge chunk of that market.
And much like Microsoft in the nineties, Microsoft Teams takes that platform advantage and turns it into an offer that its considerable base of existing customers can't refuse.
On the other hand
In other, important ways, Microsoft Teams couldn't exist without current CEO Satya Nadella and his kinder, gentler philosophy for the company.
Nadella has envisioned a world where the device you use matters less than the services connected to it: The whole idea behind Office 365 is that your apps and documents follow you across Windows PCs, Macs, Apple iPhones, Android tablets, and whatever else you connect it to. It's a stark contrast with Microsoft's imperialist, Windows-first reputation.
Chat is a natural fit for that. In our connected world, it's a huge boon to be able to start a conversation on one device and finish it on another. Combine that with the workplace nature of Microsoft Teams, where you can see the conversation going on around documents and data, and it plays right into that larger strategy.
Unfortunately, though, Microsoft Teams seems to suffer from one of the worst hallmarks of Microsoft's earliest software efforts: Early hands-on experiences from the likes of PC World say that while it's cool and potentially very useful, Microsoft Teams is also a little complex and sports a learning curve.
On that note, Microsoft's selling strategy may be smart, but it's far from bulletproof. Products like Slack and Atlassian HipChat got to their current lofty positions in the chat market because they made signing up free and easy, and because people actually really liked using them.
Unlike in the Gates era, it's never been easier for people to circumvent the IT department and use whatever tool they want. While Microsoft is confident that they've built a better mousetrap, the burden of proof is definitely on them when it comes to building something people actually want.