Dark Reading is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them.Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Risk

2/25/2010
07:18 PM
Chris Murphy
Chris Murphy
Commentary
Connect Directly
LinkedIn
Twitter
RSS
E-Mail
50%
50%

Global CIO Quick Take: Don't Crown Salesforce Cloud King Just Yet

CEO Marc Benioff has something most companies don’t--blockbuster sales results. But in his latest market expansion, he's in for a fight.

Salesforce CEO Marc Benioff did everything short of whistling "zip-a-dee-doo-dah" while discussing the past year's financial results during a conference call this week. What, you didn't have boffo sales growth last year? Your sales aren't up 21% for the year, cash flow up 18%, earnings per share up 82%? Guess you're not Salesforce, then.

"We just went through one of the most horrific times of all time for technology spending," Benioff said. "One of the most difficult times for a lot of companies, and certainly a difficult time for our peers. Yet Salesforce.com kind of sailed through it really well. ... If anything was going to injure us, it's kind of what we have just gone through."

Impressively, 30% of Salesforce's new business growth comes from products other than its flagship salesforce automation service, primarily from its customer service online software and its online custom app platform.

Four years ago, InformationWeek asked in a cover story "Does Salesforce.com Have The Chops To Become A Billion-Dollar Company?" Now that it's on a $1.4 billion-a-year run rate, Benioff has his sites on $2 billion a year, planning to spend on salespeople even if it means slightly slower growth of its profit margin. With only 31% of sales outside the U.S., there's a lot of greenfield out there.

"We're just not in enough deals. ... We need to continue to visualize ourselves beyond that $2 billion revenue number with a fully diversified product line," he said. "That's where we're moving." The next big product in Salesforce's pipeline is Chatter, a Facebook-like collaboration platform it plans to start selling sometime later this year.

It's a growth story that rings true.

What doesn't ring true, though, is Benioff's summary dismissal of legacy vendors as competitors in the cloud. It worked for CRM, where Salesforce.com's tool was one-of-a-kind. But the crowded world of collaboration, where it's headed with Chatter, is a whole other fight.

Chatter is intriguing. But for solving a lot of everyday practical collaboration headaches, so is Microsoft's coming online version of Office. And as far as adopting a SaaS collaboration platform, a lot of CIOs will give a long look this year to Outlook--meaning they'll seriously consider pushing that to the cloud. Or perhaps even replace it with Google Apps, opening new options for collaboration. Can IBM revitalize Lotus with aggressive pricing of a cloud option? Can Cisco turn WebEx into more than an online conference room? Are companies too entrenched with SharePoint to even consider another collaboration platform? I raise all these because there a lot of reasons for CIOs to build additional functions--Facebook-like functions--into collaboration platforms employees already use, rather than bring in another.

Chatter is intriguing because it promises something different--that it'll make collaboration an embedded part of things you already do, and apps you already use. To claim that coveted role, though, Salesforce will have to take on some very real rivals with their own cloud-based stories.

Global CIO small globe Chris Murphy is editor of InformationWeek.

To find out more about Chris Murphy, please visit his page.

For more Global CIO perspectives, check out Global CIO.

Comment  | 
Print  | 
More Insights
Comments
Threaded  |  Newest First  |  Oldest First
News
US Formally Attributes SolarWinds Attack to Russian Intelligence Agency
Jai Vijayan, Contributing Writer,  4/15/2021
News
Dependency Problems Increase for Open Source Components
Robert Lemos, Contributing Writer,  4/14/2021
News
FBI Operation Remotely Removes Web Shells From Exchange Servers
Kelly Sheridan, Staff Editor, Dark Reading,  4/14/2021
Register for Dark Reading Newsletters
White Papers
Video
Cartoon Contest
Write a Caption, Win an Amazon Gift Card! Click Here
Latest Comment: "Elon, I think our cover's been blown."
Current Issue
2021 Top Enterprise IT Trends
We've identified the key trends that are poised to impact the IT landscape in 2021. Find out why they're important and how they will affect you today!
Flash Poll
How Enterprises are Developing Secure Applications
How Enterprises are Developing Secure Applications
Recent breaches of third-party apps are driving many organizations to think harder about the security of their off-the-shelf software as they continue to move left in secure software development practices.
Twitter Feed
Dark Reading - Bug Report
Bug Report
Enterprise Vulnerabilities
From DHS/US-CERT's National Vulnerability Database
CVE-2021-2296
PUBLISHED: 2021-04-22
Vulnerability in the Oracle VM VirtualBox product of Oracle Virtualization (component: Core). The supported version that is affected is Prior to 6.1.20. Difficult to exploit vulnerability allows high privileged attacker with logon to the infrastructure where Oracle VM VirtualBox executes to compromi...
CVE-2021-2297
PUBLISHED: 2021-04-22
Vulnerability in the Oracle VM VirtualBox product of Oracle Virtualization (component: Core). The supported version that is affected is Prior to 6.1.20. Difficult to exploit vulnerability allows high privileged attacker with logon to the infrastructure where Oracle VM VirtualBox executes to compromi...
CVE-2021-2298
PUBLISHED: 2021-04-22
Vulnerability in the MySQL Server product of Oracle MySQL (component: Server: Optimizer). Supported versions that are affected are 8.0.23 and prior. Easily exploitable vulnerability allows low privileged attacker with network access via multiple protocols to compromise MySQL Server. Successful attac...
CVE-2021-2299
PUBLISHED: 2021-04-22
Vulnerability in the MySQL Server product of Oracle MySQL (component: Server: Optimizer). Supported versions that are affected are 8.0.23 and prior. Easily exploitable vulnerability allows high privileged attacker with network access via multiple protocols to compromise MySQL Server. Successful atta...
CVE-2021-2300
PUBLISHED: 2021-04-22
Vulnerability in the MySQL Server product of Oracle MySQL (component: Server: DML). Supported versions that are affected are 8.0.23 and prior. Easily exploitable vulnerability allows high privileged attacker with network access via multiple protocols to compromise MySQL Server. Successful attacks of...