Quick Take: Salesforce.com acquisition and market impact

it's probably Oracle

As someone who has done a lot of Oracle work over the years, I have a very specific opinion on who is likely to buy Salesforce. It's Oracle.

I've long thought Marc Benioff is the only likely candidate to succeed Larry Ellison as the king of the enterprise software world. 

It's well known that Larry Ellison has long-since turned his attention to passion projects - sailing, Hawaii, real estate and art collecting, etc. He's worked hard to make sure the people at the top of the Oracle pyramid - Catz and Hurd - reflect his values and approach to growth.

But the path forward for Oracle likely does not lie in its history. The industry is much different than when they launched their first database, their first version of their ERP software, or even when they bought PeopleSoft. The monolithic approach to software is crumbling and a platform-driven ecosystem is emerging. Oracle's future success is unlikely to be purely apps and much more likely to be a combination of apps and the platform that bring their software together with the rest of the marketplace.

At the same time, Oracle's cloud approach is not as robust as they portray. Salesforce would significantly improve both their platform and the talent pool that develops the platform. I think it's possible Oracle sees this as a way to buy themselves into a leadership position in cloud - which they currently do not have.

Product integration would be a cinch. Salesforce is basically built on Oracle components already. Oracle's CRM offerings aren't very good right now and they already have a large customer base that run both Salesforce and Oracle ERP apps.

Benioff would also be able to fix the operational issues that plague Oracle - a chaotic sales approach with multiple reps going after the same clients, uncoordinated; confusing and frustrating licensing structures, a slow product development organization, and not enough focus on shifting customer norms.

They both have apps issues. They both have platform issues. Neither company offers a perfect product, but together and with the best leader in enterprise software today, they are better positioned to improve both over the long-term.

The other players

Microsoft 

After Oracle they are the second most likely buyer, but I'm not sure they want to play in the enterprise space that much. They have Dynamics which has received relatively limited investment but still has a solid installed-base. Dynamics is strong in the mid-market and its CRM solution competes against Salesforce. It wouldn't be a huge platform play for them - they already have something mature and well-established. 

IBM 

There's lots of buzz about IBM right now, but I don't see how Salesforce would fit in with their cloud investments. I don't see apps as a big play for them as it seems they are moving towards platform plays and they already own a "cloud" platform. I would read a Salesforce acquisition as a little bit of a hail mary from a panicking company

Google

I don't know if they have actually been mentioned by credible sources, but their name has come up on Twitter. This is not happening and should not happen. There is no reason for Google to own Salesforce.

Cisco

Same comment as Google, but I don't see this at all. Cisco doesn't know how to run a big software company and Benioff doesn't want to run Cisco. There is little compatibility here.

The Secret Bidder

It's unlikely they exist. Salesforce is really expensive and it only makes sense as both a platform buy AND an application buy. You wouldn't pay this price for one or the other. There are only a handful of large companies for whom this acquisition makes sense and they are named above. SAP? No. Infor? Also no. I don't see any other real candidates.

Stephen Ronan

Ronan Consulting Group, 06907

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