This week Salesforce named Microsoft Azure as its public cloud provider for marketing cloud. Microsoft is the fourth IaaS platform on which Salesforce wants to run its software. The Salesforce relationships with Amazon AWS and Google Cloud were dated back to 2016 and 2017 respectively. The last partnership with Alibaba Cloud was sealed in July this year.
These four cloud IaaS vendors count for four out of six players in Gartner’s Magic Quadrant for Cloud Infrastructure as a Service, worldwide. It is a highly matured market with only six vendors left, but there is no shortage of growth. Gartner projects revenue in the cloud IaaS market to increase to $81.5 billion by 2022, up from $41.4 billion in 2019. But most of the enterprise interest and revenue are currently directed toward two providers: AWS and Microsoft. The market views both AWS and Microsoft as being general-purpose providers capable of supporting a broad range of workloads. Google is making steady progress in terms of enterprise adoption and Alibaba dominates the market for cloud IaaS in China.
The one obvious benefit that Salesforce chose to work with all four cloud IaaS market leaders is to speed up its geographical expansion. Salesforce’s instances for Canada and Australia both run on Amazon AWS and its China instance will run on Alibaba cloud.
But that’s not the only reason. The other driver that I see is while large enterprises are moving their applications and analytics workload to cloud IaaS, which include cross-domain core customer processes, consumer-facing apps and customer analytics, they expect their SaaS CRM vendor to be able to meet them on the same cloud. Here is an example. You can read the reports on Salesforce and AWS implementation from National Australian Bank.
The third reason, which for the short term benefits Salesforce but for the long term benefits Salesforce’s customers and partners, is Salesforce is spending significant engineering and change management effort with its own operational team, in order to move and run its software and lightning platform on the four leading cloud IaaS. This is a significant undertaking for a large software vendor. Over time it could bring improved availability and capacity planning, cloud elasticity, interoperability of data and processes, and multi-experience support to its customers and partners.
The last reason: Salesforce’s partnership with these players are not only limited to public cloud hosting. The relationship extends to other product groups such as productivity suits, analytics, AI as well as joint go-to-market efforts. I am a believer that the future of SaaS is in the hands of those who can build and run an ecosystem well, an ecosystem that their clients can leverage to drive their own digital transformation. This trend will force many technology players to work together, instead of against each other and Salesforce is just doing that.
*This article is reprinted from the Gartner Blog Network with permission.