Jul 27, 2018

The big picture: Slack is more dominant than ever

Slack's London office. Photo: Slack.

It may not have the traditional moat to fend off competition, but Slack has nonetheless managed to build quite the castle by out-executing its rivals.

Why it matters: Everyone in business software looks at Slack and says "I can do that." Yet most have flopped spectacularly, while Slack continues to power ahead even as Microsoft, Google and others remain in the hunt.

Between the lines:

  • Tech-industry business wisdom says successful companies need a moat — a way to keep competitors from easily seizing their markets and customers. Slack was often criticized as a castle without a moat, and thus ripe for plundering.
  • Yet rivals big and small have failed to conquer Slack. The latest evidence came in a deal Thursday, in which Atlassian announced it is shutting down rival business chat services Hipchat and Stride, selling the intellectual property to Slack, and investing in the company.

The Atlassian deal should help Slack on several levels, Constellation Research principal analyst Alan Lepofsky tells Axios. He says:

"Slack is making some smart moves. Since they don’t have native business functionality of their own (ex: Sales, Marketing, Finance, ERP, etc.) they are focused on being a hub where business applications can be integrated. One of their original, and still core markets is technical teams (developers, engineers, etc.) so partnering with Atlassian (BitBucket, Jira, Confluence) makes a lot of sense. Many of the customers of those applications would not be interested in Microsoft Teams, so without Stride in the picture, Slack becomes the de facto choice for them."

The big picture: Slack started out without a big differentiator, but now it has two. First, its wide adoption has helped build a vast web of partnerships and integrations from other companies. Second, within organizations that use it, Slack has become the place where business gets done, supplanting email.

The other side: Rivals keep on coming. Facebook, which continues to harbor ambitions of being a larger presence inside businesses with a product known as Workplace, is buying Redkix, which combines email, calendar functions and messaging in a single app. The move is designed to improve Workplace's messaging capabilities, according to Recode, which had the scoop on the deal.

Market reaction: Slack is still private, but shares of Atlassian rose more than 18% following the news.

What they're saying:

  • Protocol Labs' Mikael Rogers: "Imagine winning a market so dramatically that your competitor shuts down their competing services, hands you their IP, and gives you money for the trouble."
  • Box CEO Aaron Levie: "The future of IT will be driven by best-of-breed products built by insanely focused companies. This move by Slack and Atlassian is super smart and lets them double down on their strengths."

Go deeper

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 3 a.m. ET: 665,164 — Total deaths: 30,852 — Total recoveries: 140,225.
  2. U.S.: Leads the world in cases. Total confirmed cases as of 3 a.m. ET: 124,665 — Total deaths: 2,191 — Total recoveries: 1,095.
  3. Federal government latest: President Trump announces new travel advisories for New York, New Jersey and Connecticut, but rules out quarantine enforcement. Per the CDC, residents of those states must now "refrain from non-essential domestic travel for 14 days," with the exception of critical infrastructure industry workers.
  4. State updates: Alaska is latest state to issue a stay-at-home order — New York is trying to nearly triple its hospital capacity in less than a month and has moved its presidential primary to June 23. Some Midwestern swing voters who backed Trump's handling of the virus less than two weeks ago are balking at his call for the U.S. to be "opened up" by Easter.
  5. World updates: In Spain, over 1,400 people were confirmed dead between Thursday to Saturday.
  6. 🚀 Space updates: OneWeb filed for bankruptcy amid the novel coronavirus pandemic.
  7. Hollywood: Tom Hanks and Rita Wilson have returned to U.S. after being treated for coronavirus.
  8. What should I do? Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk
  9. Other resources: CDC on how to avoid the virus, what to do if you get it.

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Coronavirus updates: Global death toll tops 30,000

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens and confirmed plus presumptive cases from the CDC

The novel coronavirus has now killed more than 30,000 people around the world — with Italy reporting over 10,000 deaths, per Johns Hopkins data.

The big picture: The number of deaths from COVID-19 in the U.S. surpassed 2,000 on Saturday. The United States leads the world in confirmed coronavirus infections — more than 124,000 by early Sunday. The number of those recovered from the virus in the U.S. passed the 1,000-mark on Saturday evening.

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Photo: Olivier Douliery/AFP via Getty Images

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The big pig picture: President Trump has called the antiviral drug "promising," but the results of six clinical trials on this investigational medicine are still being conducted, so its effectiveness the treatment of the novel coronavirus has yet to be proved. The World Health Organization is involved in the tests.

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