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10/10/2009
12:51 PM
Bob Evans
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Global CIO: Oracle-Salesforce Shocker As Benioff To Speak At Oracle World

They've spent the last year ripping each other's strategies, belittling each other's approaches, and gloating over competitive wins. So why in the heck are they now trying to make nice?

After insulting each other's strategies and companies for the past year, Oracle CEO Larry Ellison and Salesforce.com CEO Marc Benioff are making nice as Benioff will make a high-profile presentation at next week's Oracle Open World extravaganza. I hate to seem low-brow, but I have to ask: why?

Dell CEO Michael Dell will join Benioff to discuss "The Best of Both Worlds: Customer Success in the Cloud and Oracle and Salesforce.com." The conference guide says Benioff and Dell will discuss "how salesforce.com is helping to make Oracle customers even more successful today in the Sales Cloud, Service Cloud, and Custom Cloud. Join Benioff for an inside look at salesforce.com's vision for enterprise cloud computing, including Service Cloud 2, the company's new product for customer service in the age of Google, Facebook, and Twitter."

Yes, simply amazing. Or, put another way, what the heck is going on? Why are they doing this after each has been so eager over the past year to try to verbally disembowel the other? Who blinked?

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After all, it was just 6 months ago when Benioff said this about Ellison and Oracle and its cloudness cluelessness:

"Larry is my mentor—he's really smart—but Oracle just doesn't understand cloud computing," says Benioff. "One day they want to be the cloud leader, the next they don't want to have it at all. One day cloud computing is ridiculous, the next day they're saying that they're the dominant player. They're just having a hard time in articulating the vision for the company in general. They don't know how cloud computing fits with its foes in their world."

Now, maybe Ellison saw that and said, "You know, Benioff's right—we don't know squat about the cloud. Maybe I should invite him to do a keynote-type address at Open World about how we can work together to deliver more to customers." Yeah, maybe he said that—but probably not.

So why the at-least temporary rapprochement? What has changed to bring about the current Minnie Ripperton "Loving You" moment, after Benioff earlier this year said Oracle's business model yields "stagnant legacy technology costs"? And that "In face-offs with Oracle, Microsoft, and SAP, customers moved to the cloud in record numbers in FY '09. That's because in days like these, when cash is king, liquidity is critical, and credit is scarce, the predictable flexible cost of cloud computing is overwhelmingly the right choice."? What gives?

As we wrote earlier this year in "Salesforce CEO Marc Benioff Has Declared War—Are You Enlisting?", Benioff was hammering Oracle and SAP's approach as expensive, inflexible, and outdated. And now he's going to tell everyone how to get "the best of both worlds"? Simply amazing.

Never exactly the shy and retiring type, Larry Ellison has eagerly embraced the toe-to-toe battle with Salesforce.com and has regularly made explicit comments about how Oracle was thrashing Salesforce.com in the narrow sliver in which it, relative to Oracle, operated. As we reported in February:

In the analyst call yesterday, though, Ellison showed no hesitancy whatsoever about talking up a string of victories he said Oracle has racked up at Salesforce's expense. Ellison said Oracle just landed its biggest cloud deal to date and emphasized that it was not only "a competitive win over Salesforce.com" but also "a replacement of Salesforce.com." "The customer will be de-installing Salesforce and replacing it with Oracle Sales on Demand, so we're very excited about that," Ellison told the analysts. "When we compete head to head with Salesforce, we win more deals than we lose and that's new in the last couple of quarters."

Ellison also said that the quarter Oracle had just completed was "conspicuous" for "a series of competitive wins versus Salesforce.com."

So let's run through a few hypotheses about why Benioff, in the company of highly trusted Oracle strategic partner Dell, will be at Open World in a few days:

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