Salesforce agrees to pay $27.7 billion to acquire Slack platform - The UpStream

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Salesforce agrees to pay $27.7 billion to acquire Slack platform

posted Sunday Dec 6, 2020 by Scott Ertz

Salesforce agrees to pay $27.7 billion to acquire Slack platform

Over the past few years, the number of chat apps has grown in a way that defies explanation. Part of that industry has been chat and communication platforms intended for groups, particularly in business. Several years ago, the nearly undisputed leader in that space was Slack, a service that mimicked the bulletin board systems of the 80s and 90s, without some of the more popular features. Move forward a few years, and the company has been valued at nearly $30 billion because of the company's sale to Salesforce.

Salesforce is likely hoping to improve its communication offerings. The company's existing product, Chatter, has not received a lot of positive attention. In the growing environment of work from home, the value of communication platforms has become even more important to companies. But Slack has struggled to keep up with demand, so perhaps under the Salesforce umbrella, the service will be able to add features that are wanted to compete with the emerging industry leader, Microsoft Teams.

The sale comes after the brand's lead has diminished, with the bulk of the focus moving to Microsoft's Teams platform. While Slack has struggled to implement simple features that businesses have wanted, Microsoft has been able to adapt to the needs of its customers. Plus, Microsoft's existing relationship with businesses, through Windows, Windows Server, Azure, Microsoft 360, and more, has made the integration easy.

The history of the relationship between the two brands is more complicated. Microsoft offered to purchase Slack several years ago, which the company was not interested in at the time. After the rejection, Microsoft took to retiring Skype for Business and replace it with the newly developed Teams.

Microsoft and Salesforce once had a very positive relationship, though it seems to have diminished over the years. It started to fall apart in 2012, when Salesforce CEO Marc Benioff insulted Microsoft and Windows 8. Now, the companies will be in even tighter competition, since Slack and Teams are going to be at the forefront of both companies' brands within businesses.

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