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Microsoft Corporation’s (MSFT - Free Report) collaboration and communication platform, Teams, is now available for free to its wide base of 85 million Office 365 subscribers spread across 181 markets. The company had previewed the platform in Nov, 2016.

Apart from the chat functionality and security features built within the platform, Teams can also be integrated with third-party services such as Zendesk, Asana and Hootsuite. 

Notably, the platform is available in 19 languages.

The general availability improves Microsoft’s competitive position against Slack, a well-known name in the market.

Why this Move?

Microsoft has had reasonable success with the preview launch of Teams wherein nearly 50K organizations signed up for the product including Accenture, Deloitte, Trek Bicycle and Expedia. 

As per a MarketsandMarkets report, the Unified Communication as a Service (UCaaS) market is estimated to reach a whopping $24.9 billion by 2020 at a CAGR of 10.5%.

Competition is intensifying with the presence of major players such as Slack, Facebook’s (FB - Free Report) Workplace, Amazon’s (AMZN - Free Report) Chime and Atlassian’s (TEAM - Free Report) Hipchat.

However,  Microsoft has an edge over its peers due to the popularity of Office 365.

We note that Office 365 subscribers are already familiar with other Microsoft applications such as Word, Excel, Powerpoint, SharePoint and OneNote, which could pave the way for greater adoption of the Teams platform.

Employees will take relatively less time to get acquainted with the platform in comparison to others offering similar services.


 

Stock Performance Overview

Shares of Microsoft have underperformed the Zacks Computer – Software industry over the last one year. While the industry gained a modest 22.2%, the stock appreciated only 20.2%.

The underperformance of the stock could be due to softness in the core computing market coupled with an intensifying competitive landscape.

Zacks Rank

At present, Microsoft carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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