I can’t keep quiet anymore, so I’m whispering into the blogosphere echo chamber. I think, wait for it . . .
Google’s acquisition frenzy isn’t over yet.
Nothing like going out on a limb, stunning prognostication. Which company you ask, assuming you’re still reading? How about salesforce.com? How does that strike you?
This isn’t a new idea. It’s been debated by analysts, journalists, and bloggers and for a while. The recent amorphous partnership rumors, which may culminate on June 5, have only stoked the speculation. I thought this months ago when Google Apps for Your Domain debuted to much fanfare. I can’t prove anything, but you believe me right? Guess who was an early adopter?
I think about enterprise search a lot (for work and fun, sad), and guess who has a bunch of Google OneBox modules to index and crawl their data?
Coincidence? Don’t think so. Google wants enterprise business because that’s where big bucks, and recurring revenue streams live. Google has massive brand appeal, so they (rightly?) believe that the long tail can wag the dog. The Google Mini (and to a lesser extent GSA) has made a lot of progress invading enterprises as a departmental solution to organize the chaos; its black box nature and dead simple interface appeal to those wanting small, fast and easy answers. Plus, it’s freaking Google, and everybody wants the Internet to be more like Google.
But search only helps people find stuff, not do stuff. The doing stuff is where the real money lies. So, enter Google Apps for Your Domain for doing email, scheduling, chat, web development, documents, spreadsheets and presentations (soon). Now, Google Gears allows you to do stuff offline; right now, it only works with Google Reader, but there’s a good chance that you (reader) are using that Reader. As an aside, I love the offline Google Reader because feed reading is a serious commitment.
Google could be happy pecking away at roughly $11.6 billion business that is Microsoft Office, a.k.a. the Information Worker business, but why not concurrently eat into the enterprise application business sized in the $15-20 billion at the same time?
Google wants a piece of that pie, and the market for on demand or SaaS (software as a service) business applications is wide open and lucrative. Oracle On Demand has been around since 1999 and was a $397 million business in 2006 (according to the FY06 annual report). Yes, this number does include the revenue of acquired on demand customers, e.g. from Siebel. Late to the SaaS game, SAP has committed to investing between 300 and 400 million Euro into A1S, which will be a completely hosted application suite. Both vendors do (or will) offer a full compliment of applications, including CRM.
Salesforce.com has the customers, the applications and the experience competing in the enterprise space. They have proven that hosted CRM is viable and can be lucrative, but salesforce.com won’t be able to go it alone against Oracle and SAP.
This is a perfect match. Let’s look at who brings what to the table:
- Hosted enterprise applications
- A nice customer base, claiming more than 32,000 customers
- Experienced sales force with key enterprise contacts
- The AppExchange platform, untested, but a nice throw-in
- The world’s most powerful global brand
- Massive scale in data center and hosting infrastructure
- Aspirations of world domination (OK, that’s a stretch, but they inspire fear )
- A growing suite of productivity applications as a compliment
- Scary amounts of information about what people do online
That last point makes it all the more relevant. Google knows all about us and even wants to think for, I mean help, us; Google even knows if the we have a cat. This is a nice fit for sales force automation apps, i.e. knowing your customer makes it easier to sell something. Imagine the value proposition to customers of the Googleforce.com apps;
Let Google sell your rhinestone pet collars and homemade fluffy pet beds. It’s cheap and hosted by your good old buddies at Google (we’re not evil, so you can trust us). Based on your zip code, there are 40 potential pet owners in your immediate neighborhood. Of these, 20 have Facebook profiles (we crawl those too), and from the profiles, we see that 3 went to Ivy League schools. They probably have too much money and love their pets way too much. Here are their phone numbers, addresses, web histories, del,icio.us bookmarks, blogs, resumes, etc. One of them looks at porn a lot, so maybe skip him, your call. Happy selling!
As long as I’m speculating, I’ll throw this into the mix. What’s Shai Agassi doing these days? He sports a hefty resume and is famously unemployed, and he’s into causes (check out his blog). Maybe he’s the next Google posterboy, an executive with a cause. If you believe the rumors (the WSJ article requires a subscription), his departure wasn’t that smooth, and we know he doesn’t like Oracle. So, maybe he’d listen.
So far, I’m all talk, but now that it’s out there, it can’t be unsaid. I work for Oracle, which should be obvious by the blog name, so feel free to apply the grain of salt. Fire away.