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Box CEO: Strong Feedback for Relay Workflow Solution

The new Box Relay workflow solution that Box developed with IBM will officially launch later this year, but it’s already being rolled out as part of a beta test to some of Box’s data customers and the initial feedback has been promising, according to Box CEO Aaron Levie.

Relay was announced by Box and IBM at the BoxWorks conference in September.

It’s “our first foray into workflow with enterprises, but you’re going to see more capabilities” with Relay “over time, both in the Box core product, as well as additional services that allow us to address use cases in the workflow space,” Levie said at the Morgan Stanley Technology, Media & Telecom Conference in San Francisco March 2.

So far, there’s been an “overwhelming response” to Relay from customers, who said they had been looking for such a service from Box to help them “move beyond being able to do end-user file sharing and collaboration [and also], ultimately, to be able to power important and critical business processes on Box,” he said.

One day earlier, while discussing Box’s results for the fourth quarter (ended Jan. 31) in an earnings call, Levie told analysts: “We see a massive opportunity to take the legacy approach of very, very complex workflow systems and be able to deliver a very simple end user-driven experience on top of the content in Box.” He predicted “that will be a major driver to helping customers replace their legacy” enterprise content management systems, and added: “You’re going to see us invest more in workflow and being able to deliver business processes in an intelligent way through the Box Platform over the coming quarters and coming years.”

The company reported revenue of $109.93 million, up from $84.98 million, with a fourth-quarter loss of $36.88 million, up from a loss of $50.37 million the company reported a year earlier.

The company’s fourth-quarter revenue growth “demonstrates the strength of Box’s products, which it continues to invest in,” MUFG Securities Americas analyst Stephen Bersey said in a research note March 2.

Box is “going to build on” its success “by further focusing on two major objectives” this fiscal year, Levie said on the earnings call. “First, we will continue to innovate in cloud content management with additional products and platform capabilities to help enterprises move more of their workload to the cloud. And, second, we’ll continue to invest in and advance our global go-to-market efforts, so we can reach more enterprises all around the world,” he said.

In the fourth quarter, Box launched a “significantly enhanced and expanded version” of Box Notes, its real-time collaboration tool for teams. More than a third of Fortune 500 companies are “already using Box Notes as part of their overall Box deployment,” he went on to say.

Box, in the quarter, also announced new ways that Box works with Microsoft’s Office 365 software, “enabling round-trip editing and deep integration” of Office on Android, he noted. The company’s goal is for its users to be able to “seamlessly access and work with our content in Box from any application they need,” he said, adding that Microsoft “continues to be a key partner in our strategy to provide a single secure platform for cloud content management.”

The moderator of Box’s Morgan Stanley conference presentation on March 2 asked why Microsoft was “playing so nice” with Box when the companies competed directly with each other.

Levie replied: “When you look at the state of enterprise software today, it is breeding – out of necessity in some cases – more than anything, it’s breeding the need for players to be able to interoperate and be able to work together. We’re in a multiplatform, multi-stack world. It’s not like it was in the 2000’s or the ‘90s, where Microsoft or Oracle sort of owned the entire stack.” Devices running on multiple platforms are being used regularly today, including Android, iOS and Windows, he pointed out, calling it a “completely different world” now.

Microsoft recognizes that “to be able to serve their customers successfully, they have to partner with third-party solutions and external companies,” he said. At the same time, Box customers “want a neutral provider to be the backbone of how they manage their information and their content” and, if you put all of your data in just one of these vendors, it reduces your ability to have a future-proof solution that can integrate with all the different applications that you’re using,” he said.

Also significant, he said, is that when you look at all the services that Microsoft offers, Box serves as a “very strong partner or a complement to probably 90 to 95 percent of their technologies and [is] only competitive” with Microsoft “in a very limited area.”