MSFT Microsoft Corporation

By Angus Loten 

Microsoft Corp. is leveraging a strong position in cloud computing and enterprise software to drive growth for Teams, its two-year-old enterprise collaboration tool, IT industry analysts and researchers say.

The software giant Tuesday said more than 500,000 organizations are using the tool for workplace chat, messaging and meetings, including 91 Fortune 100 firms, and at least one Nascar racing team.

Matthew Cochran, manager of IT at racing team Hendricks Motorsports, said Teams became an essential communications tool at the start of the 2018 season, when racing authorities limited the number of crew members on the racing track to a dozen.

"We need to relay strategic information to the crew chief in the box and the pit crew, so that they can make appropriate changes," Mr. Cochran said, adding that a lot of race information is processed in the office, "where it's not as loud as on the track." This includes everything from monitoring fuel, to tire wear and the optimal position for the car on turns and straightaways, he said.

"Teams allowed us to centralize messaging and use file-sharing and other tools, all in one place," Mr. Cochran said.

Microsoft said of its current users, 150 organizations have at least 10,000 active daily users. The company said it also has completed its own internal migration, shifting 180,000 employees from Skype for Business to Teams, as part of a move to replace Skype over time.

To mark the two-year milestone, Microsoft this week rolled out a number of new features for Teams, including customized backgrounds for videoconferencing, live captions for meetings and a broadcast feature for up to 10,000 viewers.

Larry Cannell, research director for collaboration and content strategies at Gartner Inc., described Microsoft's strength in the cloud as "an enabler" for Teams, but said its position on the desktop plays a large role.

"CIOs of companies that have already purchased Office 365 and finished migrating their email services are especially interested in getting more out of their licenses" with Teams, Mr. Cannell said.

Lori Wright, general manager of workplace collaboration at Microsoft, said the tool's integration in Office 365 is a big advantage, but a broader change in workplace culture also has been a key driver of growth.

"Gone are the days of cubicles and silos," Ms. Wright told CIO Journal. "Workplaces are moving from rigid hierarchical structures to more inclusive models built around teamwork and shared success."

The global market for enterprise collaboration is estimated to have reached $2.4 billion last year, up 11.8% from 2017, and is expected to hit $3.2 billion by 2021, according to International Data Corp.

"The market is accelerating faster than even the most optimistic forecasts," said Wayne Kurtzman, an IDC research director for social and collaboration.

Much of that growth is driven by the consumerization of technology, he added, which is prompting workers to expect the same capabilities around the office that they now have sharing photos and videos with friends, making restaurant and hotel reservations, or buying services and products with their personal mobile devices.

"The collaboration market is new enough that there is room for several players in the years ahead," Mr. Kurtzman said.

Slack Technologies Inc., launched in 2013, said it has 10 million daily active users, including 65 Fortune 100 firms and 85,000 paying customers -- up 50% in the past year alone. Beyond meetings and messaging, Slack in recent years has positioned itself as a hub of workplace activity, offering more than 1,500 apps in its directory, according to the company.

Last month, Slack announced plans to go public in a direct listing on the stock market, with a likely valuation well above $7 billion. Slack declined to comment.

Facebook Inc.'s Workplace, another rival in the enterprise collaboration space launched in October 2016, today has two million paid users, including more than 150 companies with over 10,000 users each, the company said. It began charging users in October 2017.

"Real change and collaboration occurs when companies turn into communities, and this is strongest when everyone from front-line workers to the C-suite are connected," said Julien Codorniou, vice president of Workplace by Facebook.

Write to Angus Loten at angus.loten@wsj.com

(END) Dow Jones Newswires

March 20, 2019 05:44 ET (09:44 GMT)

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