Longtime rival companies Microsoft Corp. and Salesforce.com Inc. have announced the formation of a partnership that will allow their products to work better for businesses.
The partnership is a sign that the tension between the two companies has cooled off, as Microsoft CEO Satya Nadella and Salesforce CEO Marc Benioff enter into the deal intending to provide additional value to the users of products from both companies.
"Customers need and want us to work together. They want to be able to work with Office 365, Excel, Outlook and Salesforce," Benioff said. "This fundamentally advances our goal of making our products more useful."
While the exact details of the partnership have not been disclosed, it was revealed that Microsoft will be integrating Salesforce apps into both the company's Windows and online Office platforms. It is expected that Salesforce products for Microsoft Office will be released next year. Salesforce's customer management apps will be made available on Windows PCs, mobile devices and tablets, while Salesforce users will have the ability to use Microsoft Office content such as PowerPoint presentations and Excel spreadsheets.
This move furthers Nadella's goal of boosting Microsoft's Internet-based cloud software and corporate programs. This new approach, which the CEO refers to as "mobile first, cloud first," began with Microsoft's decision to make Office available for the iPad of Apple.
In the past, Microsoft was criticized by analysts for its slow transition into the cloud-based, subscription software model that is currently preferred by smaller enterprises.
"Nadella recognized the need to partner as the company cannot do this alone," said FBR Capital Markets analyst Daniel Ives. "Salesforce remains the pioneer of cloud computing and this significantly expands Microsoft's cloud opportunity."
The history between the two companies has been tumultuous, with Microsoft filing a lawsuit against Salesforce for alleged patent infringement, which Salesforce answered with a countersuit. Just last year, Benioff publicly criticized Microsoft's Surface tablet. Microsoft once even released an anti-Salesforce advertising campaign, with the tagline "Don't Get Forced."
Benioff said that things have changed between the two companies. Salesforce has since acquired ExactTarget, which is a cloud marketing platform that was already integrated with Microsoft. Nadella's appointment as Microsoft's CEO also gave Salesforce the opportunity to forge a stronger business relationship with Microsoft, Benioff added.
Microsoft current has deals with SAP and Oracle, two companies that create customer relationship software similar to Salesforce. Nadella said that Microsoft continues to have interest in forming similar partnerships to "add value to the entire industry."
