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Facebook's Workplace Just Got a Meaningful Enterprise Partner

By Evan Niu, CFA - May 23, 2018 at 9:01PM

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The social network knows when to leave it to the pros.

Social networking behemoth Facebook (META 7.19%) predominantly offers consumer-facing products and services, but its most significant foray into the enterprise -- Workplace -- continues to make progress. Late last year, the company said it had 30,000 organizations using the service, although it opted not to disclose what proportion were paying customers. (Certain organizations like non-profits and educational institutions get to use Workplace for free.)

Facebook has just inked a new partnership that could bolster its presence in the enterprise.

Laptop showing Facebook Workplace on Windows

Image source: Facebook.

Partnering with an access management leader

Okta (OKTA 8.41%) announced today that it has partnered with Facebook Workplace. Okta is one of the leading companies providing identity access management (IAM) to enterprises, allowing employees to leverage a single sign-on (SSO) to access all of the various third-party services that their company may use and integrate with.

Workplace will be one of Okta's initial partners for its new Project Onramp, which was also announced earlier today. Project Onramp seeks to help IT administrators better manage their internal users through Okta integrations. For example, the new partnership will allow Workplace to integrate with on-premises infrastructure like directory services.

"At Workplace, we're committed to helping organizations evolve and communicate quickly and securely. Enterprise customers want to be able to provision and deprovision their users from a single source of truth, and Okta will enable our joint customers to simplify and secure the experience," Facebook VP of Workplace Julien Codorniou said in a statement. "Together we offer a pre-integrated solution to customers so they can connect and collaborate in a secure and easy way, enabling them to drive their business forward."

Importantly, the new partnership is direct acknowledgment by Facebook that there is considerable value provided by companies that specialize in enterprise software. Facebook has had its own consumer-facing SSO service for years, initially called Facebook Connect but since rebranded as Facebook Login (all of those "Login with Facebook" buttons you see on third-party sites). Instead of trying to offer an enterprise version of Facebook Connect, it's choosing to partner with one of the pros.

Evolving in the enterprise

The news is just the latest in a series of small steps that Facebook has taken to strengthen its enterprise credibility. Facebook expanded third-party integrations with Workplace pretty early on while also growing its stable of channel partners. In enterprise software, channel partners play an incredibly important role in distribution.

Meanwhile, pricing is extremely aggressive compared to alternatives like Slack or Microsoft Teams, even after a recent revamp of the pricing structure. The old structure offered price concessions for larger teams, but Facebook has now eliminated these tiers and simply offers two tiers: standard for free, or premium for $3 per user per month.

Facebook may be grappling with all sorts of scandals related to its core service, but its enterprise strategy continues to evolve.

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