Slate Money: "Cloud Chat" – December 5, 2020

Overview

This episode of Slate Money, hosted by Felix Salmon (Axios), with Emily Peck (HuffPost) and Anna Szymanski (Breakingviews), centers on major trends in business and finance, with special focus on the “cloud” — triggered by Salesforce’s acquisition of Slack. The hosts dissect why Slack sold to Salesforce, examine Microsoft Teams’ surprising dominance, discuss board diversity initiatives at NASDAQ, and analyze Amazon’s historic hiring spree and its economic ramifications. The tone is candid, often wry, with personal anecdotes and a critical look at tech industry juggernauts.

1. The Salesforce Slack Acquisition and "The Cloud Wars"

Key Discussion Points

• Slack’s rise and fall: Once the darling of enterprise software, Slack’s growth plateaus as Microsoft Teams takes the lead, prompting its acquisition by Salesforce for billions.
• Enterprise software explained: “Enterprise software” is essentially tools used by large companies; Slack and Teams are prime examples.
• Teams’ ‘boring’ appeal: Teams wins large contracts not because users love it, but because it’s bundled with Microsoft Office, making it “free” from a management perspective.
• Slack’s ‘coolness’ wasn’t enough: While beloved by media and tech insiders, Slack struggled to break into the mainstream workforce the way Zoom did.

Notable Quotes

• Felix Salmon (02:30):
  "Slack…which took the tech world by storm, was basically beaten by Microsoft Teams, which is loved by no one."
• Emily Peck (03:45):
  "Zoom use has gone crazy… families are using Zoom to do like holidays and events… Zoom has just had more universal pickup than Slack has."
• Felix Salmon (10:58):
  "The great advantage of Teams … is simply that it is perceived by senior management to be 'free.'"

Memorable Moments

• Comparison of how Slack feels intimate and distracting, while Teams is “just another work tool” (06:23–08:27).
• Media professionals share how Slack replaced “office gossip” and “random complaining” (01:40–02:03).

Timestamps

• [00:30] – Overview of episode topics, with focus on Salesforce buying Slack.
• [01:40] – Pandemic shifts conversations to Slack, especially in media.
• [03:45] – Why Zoom exploded, Slack did not.
• [09:49] – Slack’s end-user-driven adoption versus IT procurement realities.
• [10:58] – Teams and the cost-centric advantage for big companies.

2. The Culture of Enterprise Software: Who Wins and Why

Key Discussion Points

• Adoption driven by IT, not users: Enterprise software often optimized for ease of corporate rollouts rather than user happiness.
• Bundling wins: Integrating products with what companies already pay for is more effective than selling superior, standalone tools.
• "Shadow IT" and bottom-up innovation: Slack’s growth model depended on workers adopting it and eventually forcing IT to buy — but this approach hits a ceiling when IT prefers bundled products.

Notable Quotes

• Felix Salmon (09:49):
  "At the end of the day, the IT officer and people at the top… are going to go with the product that is bundled… even if it’s the crappier product."
• Emily Peck (11:52):
  "Slack and Teams are selling to these IT managers and these senior executives…gives you a worse product."

Memorable Moments

• Anna Szymanski (13:33):
  "Every job I’ve basically ever had, I’ve used Outlook for work email, and I actually vastly prefer Outlook. I can’t stand Gmail."

Timestamps

• [09:49] – Slack’s bottom-up model vs. corporate procurement realities.
• [11:52] – Commentary on IT managers as decision-makers for tools they rarely use.
• [14:04] – Shift to cloud means workers and companies can choose front-end/back-end combos.

3. What Is Salesforce? Breaking Down CRM & SaaS

Key Discussion Points

• Salesforce as a pioneer: Salesforce leads the category of SaaS (Software as a Service) and CRM (Customer Relationship Management).
• What CRM means: Centralized databases for managing customer relationships are essential for modern businesses.
• Industry evolution: Microsoft has copied Salesforce’s subscription model, shifting away from perpetual software licenses.

Notable Quotes

• Felix Salmon (14:46):
  "Salesforce…basically invented SaaS, the cloud…really was the first company to sell software as a service."

Timestamps

• [14:46] – What is CRM and what is SaaS?
• [16:27] – Salesforce’s relationship with Microsoft and the rationale for buying Slack.

4. Board Diversity Push at NASDAQ

Key Discussion Points

• NASDAQ’s new proposal: Asking companies to have at least two diverse directors (gender and/or underrepresented groups) or explain why they don’t.
• Push vs. quota: The policy is more carrot than stick — noncompliance only requires explanation, not immediate delisting.
• Private exchanges issuing social mandates: Raises questions about the role of private actors versus government in setting policy.

Notable Quotes

• Emily Peck (18:13):
  "I do think it’s a good thing…sometimes you have to push hard to get diversity, especially in this world…of corporate America."
• Felix Salmon (19:32):
  "It does feel weird…that the entity pushing this…is a private stock exchange rather than any kind of public institution."
• Anna Szymanski (20:29):
  "I’d rather have it coming from private companies than necessarily a government mandate…people may bristle less at it."

Timestamps

• [16:51] – NASDAQ’s diversity initiative.
• [18:07] – Details and intersectionality on proposed board diversity.
• [19:32] – Who should set diversity mandates: exchanges or regulators?
• [22:12] – How and why diverse board hires might happen.

5. Amazon’s Hiring Boom and Economic Transformation

Key Discussion Points

• Historic workforce surge: Amazon hires 420,000 people in a single year — an unprecedented rate in corporate history.
• Monopoly vs. monopsony: Amazon’s growing market share raises concerns about power not just as a retailer but as dominant employer.
• Permanent shift: Pandemic-driven e-commerce growth likely to cement Amazon’s position; jobs created are “purposeful and strategic.”
• Wages and competition: Amazon’s higher wages force competitors to raise theirs, helping some workers but raising broader concerns.

Notable Quotes

• Anna Szymanski (25:28):
  "The other issue…maybe more concerning, is the monopsony issue…if you’re basically the only game in town…it does put workers at a disadvantage."
• Emily Peck (29:08):
  "It’s not going to be so great in the long run for innovation…just like it wasn’t great when Walmart dominated retail."
• Felix Salmon (29:32):
  "Amazon is the one place which actually has something better to do with the money. And they're taking that money and they're using it to hire people."

Timestamps

• [24:14] – Amazon’s unprecedented 420,000 new hires.
• [25:28] – The rise of Amazon as monopsonistic employer.
• [27:48] – Permanent changes in retail and employment.
• [29:32] – Amazon’s approach to capital deployment versus Apple.

6. Numbers Round – Notable Statistics

• Felix Salmon (31:38):
  $95 million — Frank Slootman (CEO of Snowflake) earns $95 million per month in stock options.
  "Nice work if you can get it."
• Anna Szymanski (32:47):
  20% — For the first time, ancestry.com bondholders are capped: even if you own more than 20% you only get 20% voting rights.
• Emily Peck (34:05):
  11.2% — African American men’s unemployment rate as of November 2020.
  "This could be a game-changing way of looking at the real economy."

Timestamps

• [31:38] – CEO pay in cloud companies.
• [32:47] – Ancestry.com bondholder voting cap.
• [34:05] – Black male unemployment statistics.

7. Memorable Quotes & Commentary

• Felix Salmon (06:23):
  "A lot of people really hate [Slack]…incredibly distracting and unhelpful…people don’t want to be looking at GIFs all day."
• Anna Szymanski (08:27):
  "When somebody sends you something on Teams, you feel like you have to respond… it’s like somebody tapping you on the shoulder…that is not always great."
• Emily Peck (11:52):
  "It's always a struggle to use the most user friendly stuff at these big corporations. They want to steer you into the wonkiest worst software products."
• Anna Szymanski (29:08):
  "I’m like the resident Amazon apologist… but the amount of power this one company is going to have…should concern almost anyone..."

For Listeners Who Missed the Episode

This episode delivers a timely, sharp analysis on the future of work platforms (Slack/Teams), cloud software’s sway in corporate life, evolving boardroom diversity standards, and Amazon’s economic muscle. The hosts blend news analysis with personal perspectives and industry anecdotes, punctuated by memorable one-liners and rigorous debate about the real-world consequences of tech consolidation and shifting corporate priorities.

Skip to these segments if you want to hear:

• Slack’s corporate fate and enterprise software foibles ([00:30]–[14:26])
• Salesforce and the "cloud revolution" explained ([14:46]–[16:51])
• NASDAQ’s board diversity drive ([16:51]–[24:14])
• Amazon’s transformation of the labor market ([24:14]–[31:38])
• Numbers round: eye-popping pay, bondholder voting, and unemployment ([31:38]–[34:58])

The conversation is insightful, informal, and full of practical asides for anyone interested in tech, business, and how the pandemic is changing work.