Software // Enterprise Applications
01:43 PM
Doug Henschen
Doug Henschen
Connect Directly

Microsoft Questions Growth Prospects

Will the hot CRM vendor be a cloud computing shooting star? Rival exec says R&D investments won't measure up.

One can imagine the growing pains. To drive growth, Salesforce needs to move beyond the software-as-a-service (SaaS) and CRM boxes. SaaS-based CRM was a $2.3 billion market in 2009, according to Gartner. It's a growing market, but by comparison the total SaaS-based enterprise applications market (including ERP and all other apps) is expected to be $8.5 billion in 2010.

Meanwhile, the total cloud computing market (including platforms, services, infrastructure and, I assume, everything else including the kitchen sink) will hit a whopping $68.3 billion this year, according to Gartner stats.

"In order to play in the broader game, Salesforce will have to invest in infrastructure," Park says. "In the future, customers won't want to buy just cloud-based CRM services. They will want to support their total cloud strategy."

The larger opportunity surely compelled Salesforce to stop calling itself a SaaS company last year and to rebrand its offerings as Sales Cloud 2, Service Cloud 2 and so on. The limits of CRM are also behind Salesforce's launch of the Chatter collaboration service/application earlier this year.

"Chatter is's third attempt to try to sell to somebody other than sales and marketing types," says Brad Mattick, a former product marketing executive and now senior director of global product marketing at cloud vendor

Salesforce also has introduced process management, content management and other horizontal capabilities aimed at supporting CRM and a range of custom and vertical applications built on the platform as a service. But make no mistake. is still a CRM-centric company, and I'm guessing the majority of apps running on revolve in some way around customer information. (Perhaps executives are now ruing the day when they settled on "CRM" as the company's stock symbol?)

Where can Salesforce find a deep-pocket partner who can take it into the cloud computing big leagues for the long haul?

The rumor mill frequently pairs Salesforce up with Google. But why does it not surprise me that Salesforce announced on Monday that CEO Mark Benioff will be a keynote speaker at next week's Oracle Open World (reprising his appearance at last year's event)?

With buzz building that another big Oracle acquisition is in the offing, nobody should be shocked if Salesforce turns out to be the next target. Oracle is as much in need of the's cloud story as the CRM vendor -- er, cloud vendor -- is in need of Oracle's deep pockets.

2 of 2
Comment  | 
Print  | 
More Insights
Building A Mobile Business Mindset
Building A Mobile Business Mindset
Among 688 respondents, 46% have deployed mobile apps, with an additional 24% planning to in the next year. Soon all apps will look like mobile apps and it's past time for those with no plans to get cracking.
Register for InformationWeek Newsletters
White Papers
Current Issue
InformationWeek Tech Digest August 03, 2015
The networking industry agrees that software-defined networking is the way of the future. So where are all the deployments? We take a look at where SDN is being deployed and what's getting in the way of deployments.
Twitter Feed
InformationWeek Radio
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.