Google and Salesforce Ink Cloud, Apps Deal
06 November 2017 - 10:34PM
Dow Jones News
By Jay Greene
Google Cloud has picked up a marquee customer, Salesforce.com
Inc., as the Alphabet Inc. unit tries to keep pace with Amazon.com
Inc. and Microsoft Corp. in the increasingly competitive business
of providing web-based, on-demand computing services.
The deal, slated to be announced Monday at the start of
Salesforce's Dreamforce customer conference in San Francisco, comes
a year and a half after the cloud-based business software vendor
said it would move some computing operations to data centers run by
the market leader, Amazon Web Services. Salesforce also operates
its own data centers.
World-wide revenue for the business of providing cloud
infrastructure -- that is, computing processing and storage service
-- hit $22.2 billion last year, and is expected to climb to $67
billion by 2020, according to industry research firm Gartner
Inc.
One big cloud-infrastructure provider Salesforce hasn't
partnered with: Microsoft's Azure service. Salesforce and Microsoft
announced an alliance in 2014 to enable their products to work
together smoothly, but Salesforce is facing increased competition
in its core sales-force automation business from Microsoft's
Dynamics applications.
Salesforce last year pressed regulators to scrutinize
Microsoft's $27 billion acquisition of LinkedIn Inc., though the
deal ultimately won approval and closed last December.
Google Cloud, meanwhile, is working to build credibility among
corporations wary of committing to a company that has little
experience supporting the technology needs of big companies other
than its own. Its cloud-infrastructure service, which provides
computing processing and storage from its massive data centers
around the globe, trails Amazon, Microsoft and Alibaba Group
Holding Ltd., according to industry research firm Gartner Inc.
Salesforce already is running its Advertising Studio service,
which helps companies run digital ad campaigns, on Google Cloud,
Salesforce Chief Executive Marc Benioff said in an interview.
"We will in short order have all of our products running on
Google Cloud, " he said.
As part of their deal, Salesforce will offer Google's G Suite
productivity applications free for up to one year to its customers
who aren't already using them. Salesforce has more than 150,000
customers, and the company said less than half of them currently
use G Suite.
"If people already have something else that they are using, this
gives them a chance to experience" Google's apps with Salesforce
services, Google Cloud CEO Diane Greene said in an interview. "It's
a change for us to bring all of this to Salesforce's customers with
very little friction."
Salesforce also intends to weave Google Analytics, which helps
marketers analyze customer behavior, with its own Sales Cloud and
Marketing Cloud services. The combined services are aimed at
helping marketers more effectively target email campaigns.
Mr. Benioff acknowledged that money was being exchanged between
the companies as part of the deal, but both he and Ms. Greene
declined to disclose terms of the deal.
Write to Jay Greene at Jay.Greene@wsj.com
(END) Dow Jones Newswires
November 06, 2017 16:19 ET (21:19 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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