Facebook signs deal to use Microsoft's Office 365 including its email and calendar for its 13K employees, as it continues to develop Facebook at Work
Jay Greene / Wall Street Journal :
Context & Ripple Effects
Facebook has been building an enterprise business since it began testing Facebook at Work with a handful of companies in early 2015, and by September 2016 it was reportedly weeks from a paid, per-user launch. Today's twist: as it readies that product, Facebook itself signs a deal to run its 13,000 employees' email and calendar on Microsoft's Office 365.
The arrangement makes Microsoft both a supplier to and a competitor of Facebook in enterprise software — and it foreshadows how the two would eventually interoperate, with Workplace later reporting 7M paid subscribers and new Microsoft 365 and G-Suite calendar integrations in 2021.
First-order effects
- Facebook's 13,000 employees get their email and calendar from Office 365 while the company continues developing Facebook at Work internally — a dogfood split where the collaboration layer stays homegrown but core productivity runs on a rival's suite.
- Microsoft gains a marquee customer in the one company directly building a challenger to its enterprise franchise.
Second-order effects
- The deal validates a hybrid-stack buying pattern for enterprises — pairing incumbent productivity suites with newer collaboration layers — which strengthens Workplace's hand as it prepares its per-user launch and, months later, an app platform aimed at Slack's App Directory.
- For Slack and other collaboration-only vendors, a competitor that happily coexists with Office 365 signals the battleground is the social/collaboration layer, not wholesale suite replacement.
Third-order effects
- If the pattern holds, enterprise collaboration consolidates around interoperability rather than all-or-nothing bundles — a trajectory the corpus confirms when Workplace ships native Microsoft 365 and G-Suite calendar integrations years after this deal.
- Suite incumbents like Microsoft can absorb competition at the collaboration layer by supplying the productivity plumbing underneath it, shifting rivalry toward whoever owns the daily engagement surface.
The trend: Enterprise collaboration is splitting into interoperable layers, with challengers like Facebook's Workplace coexisting alongside incumbent productivity suites such as Office 365 instead of replacing them.