Salesforce and Google have struck a broad partnership, that pairs their corporate software and cloud-computing services. The new deal ties key, complementary services in marketing analytics and cloud-computing. Salesforce clients that don’t currently use G-Suite, Google’s package of workplace software, will get the offerings free for one year.
The integration of Google Analytics with Salesforce Marketing Cloud had been a top request of Google’s and Salesforce’s customers in recent months, says Google Analytics senior director Babak Pahlavan. While Google has offered APIs for companies to build on top of Google Analytics in the past, it’s never opened up the product to such a deep integration before, says Google Cloud president Tariq Shaukat.
Amazon Web Services dominates the public cloud market with a 47.1% market share. In its most recent earnings statement for Q1 of 2017, AWS reported revenues of $3.66 billion, a 42% increase from this time last year. While Microsoft Azure is gradually catching up to Amazon, it only holds 10.0% of the market.
Amazon Web Services, Microsoft Azure, and Google’s Cloud Platform continue to grow market share, with IBM holding its own as of mid-2017. Quarterly cloud infrastructure service revenues (including IaaS, PaaS, and hosted private cloud services) are at nearly $11 billion and continue a growth rate of over 40 percent per year. This means worldwide revenues from cloud and SaaS remain on track to surpass $200 billion by 2020, according to Synergy.
In Q3, the huge cloud market kept on growing by over 40% per year while Amazon Web Services (AWS) is still managing to nudge its market share upwards, despite increasingly intense competition. Microsoft, Google and Alibaba are all growing their revenues much more rapidly than Amazon and they continue to gain market share, but the reality is that in this market Amazon remains bigger than its next five largest competitors combined. Meanwhile IBM maintains its position as the third largest cloud provider in the market thanks primarily to its strong leadership in hosted private cloud services.
In Q3, Synergy estimates that quarterly cloud infrastructure service revenues (including IaaS, PaaS and hosted private cloud services) have now reached $12 billion and continue to grow at well over 40% per year.
Microsfot and Google have higher growth rates than Amazon in the cloud.
Marty Puranik, CEO of Atlantic.Net, a leading cloud hosting provider, provides expert commentary in an interview.
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Marty discusses :
What this deal means for Google and Salesforce ?
Why Google has been making so many moves in the cloud space recently ?
Why now is such a pivotal time for companies to not only involve themselves in cloud computing, but significantly ramp up their efforts, as evidenced by today’s partnership ?
What this means for the rest of the industry, i.e. Amazon and Microsoft, moving forward ?
Google and salesforce services
This is part of Salesforce ongoing war with microsoft Azure (#2 cloud) and Linkedin. Microsoft bought Linkedin. Linkedin has been Salesforces major competitor. Linkedin is very strong in Human Resources and the next target is the Sales people which is three times Human Resource market.
Salesforce endorsed gsuite which is an microsoft office 365 competitor.
Salesforce will use AWS and will deploy onto google cloud but will not support Microsoft Azure
Google Cloud moves
Google brought Diane Green from VMWare, a win for Google (#3). Google has rebranded Google Docs as Gsuite.
Google announced the launch of new desktop application for Google Drive users, called Drive File Stream, which is now available to G Suite customers. The app will serve as a replacement for the Google Drive desktop app that will be shut down for good next year – a far enough date to give enterprise customers plenty of time to make the switch.
Salesforce is #1 in CRM (Customer Relationship Management) and Sales.
The emergence of Amazon AWS as a dominant cloud provider, largely at Google’s expense. Google has a culture focused on engineering and not sales. Salesforce is good at selling and Google does not want to kill Salesforce. Google is focused on other things like self driving cars and global satellites and internet balloons. Salesforce can craft better sales messaging around cloud and cloud messaging for Google products.
Why is this a critical time
This is a Marketshare and midshare competition. It is still early days for the cloud segment. Amazon has the lead but this is not a locked in Monopoly yet. Netscape had the early lead with browsers but lost it to Internet Explorer and then Chrome became most popular.
The biggest loser in this deal is microsoft in the near to mid term.
AWS subsidizes retail. AWS is highly profitable and a key part of the story for Amazon’s high stock valuation.
Google and microsoft war of attrition from other profitable businesses. AWS profit is under attack
Microsoft risk, losing mindshare. There is business model risk for Microsoft.