Google has made another big effort to acquire Sale force for $ 250 billion. Google hopes to use this merger to change the decline in the cloud business, surpass Microsoft Azure in one fell swoop, and go directly to Amazon AWS, ranking firmly in the second place in the world.
Google made another big acquisition, this time targeting the CRM giant Sales force, which is focusing on the latter’s booming cloud business. The acquisition may be as high as $ 250 billion.
At the end of 2019, executives within the Google Cloud Platform pose quite serious challenges to its engineers and developers: publicly stated that Google not only hopes to consolidate its market position among the biggest competitors by 2023, but also expects to spend three years Defeat cloud computing giants AWS and Azure.
For now, AWS maintains the largest share of the growing cloud market , accounting for about 47% of the available market share; Microsoft’s Azure is close behind, with a 16% share. Both are far behind Google, which has only 4% market share.
However, there are speculations that Google Cloud CEO Thomas Kurian may have stuck with his seemingly ambitious forecast and may seek to acquire the industry-leading CRM service provider Sales force to accelerate Google Development of the cloud computing sector.
Although a new report highlights that Microsoft’s Azure position is rising in the near future, and more and more companies are starting to switch from AWS to Azure, RBC Capital Markets analysts told Business Insider that Google can actually avoid the possibility of putting it in trouble Work on organic cloud, and through the acquisition of Sales force, surpassed Azure to rank second in the market.
According to current forecasts, Google’s potential acquisition may be around $ 250 billion, and this acquisition will provide the company with a way to leverage Sales force’s incredible SaaS growth and its matching customer base to connect with itself The advantages of machine learning and AI are superimposed to build strong competition barriers.
For Sales force, the acquisition will be a complex process, with the benefit that the company will have access to more financial resources to expand its work on cloud computing and infrastructure. But at the same time, it is also facing the possibility of the company’s ownership being acquired by Google and being split into a dedicated integrated stack, especially Google is another company that is extremely unreliable in terms of acquisition.
Sales force has been relatively successful in the stock market, and has established mutually beneficial partnerships with Microsoft, Apple, and AWS. It seems that Google’s willingness to acquire Sales force is very slim. But when Sales force founder, chairman and co-CEO Marc Benioff appeared at CES and the company’s bullish position in the market, RBC analysts began to embrace the idea.
The news will put Microsoft at a disadvantage when it overtakes AWS and works with Sales force to provide Azure and Teams support to CRM providers. But Microsoft didn’t say anything about it, and Azure is still murmuring into more governments and enterprises.
The latest survey shows that 56 executives are using Azure for cloud infrastructure, while only 48 executives are using AWS. According to analysts, since December 2017, Microsoft’s lead in the integrated field of cloud infrastructure and platform as a service has been increasing.
This acquisition may promote Google’s rise in the field of cloud computing, but as the market continues to expand, even well-known companies in the field of cloud computing services cannot relax for a moment.
Google’s cloud business will immediately surpass Microsoft, becoming the world’s second largest cloud platform after AWS
However, there are also people who are not optimistic about the prospect of this huge acquisition. Whether Google can make a leap in cloud business with this acquisition is still uncertain.
Forbes invited contributor Gene Marks believes that a company is like a team, and the core of Sales force’s success is customer relations and enterprise services, not cloud platforms. Changing the original business focus after the acquisition may result in the loss of core members and may not bring Google the expected success.
The following is his review article on Forbes. Does it make sense, everyone judges:
Let’s say you have about a billion dollars of spare money and want to buy a baseball team. What should you look at when deciding which team to buy? Is it a fan, a stadium, or a brand? Why is a team worth the price? Why are fans watching the ball?
Because the core value of the team depends entirely on its fan base, and the fan base depends entirely on the players. Over time, if a team doesn’t value talented players, fans will leave it, no one will watch the game live, and TV ratings will drop.
OK, after that, let’s talk about Google’s acquisition of Sales force.
Google’s cloud computing business is far behind its rivals Microsoft Azure and Amazon AWS. It’s no secret that Google has been seeking big acquisitions to catch up. Google is now targeting Sales force.com as an acquisition target.
First, the acquisition is indeed seductive enough. Sales force’s cloud platform Force.com has been growing at a double-digit rate. The acquisition of Sales force can make Google almost immediately surpass Microsoft in the cloud business, becoming the world’s second largest cloud platform after AWS.
But to be truly successful, Google needs to solve some big problems. One of them is the arrangement of the current CEO of Sales force, Marc Benioff. Benioff is a pioneer in customer relationship management (CRM) and cloud services, and is an important reason for Sales force’s global success. But as I said at the beginning, a more important problem that Google needs to solve is the problem of Sales force itself. Just like a great baseball team, the Sales force app attracts many fans.
This is because the value of Sales force is not cloud infrastructure, but that it is a CRM company that provides world-class solutions through cloud infrastructure.
Sales force’s brand is synonymous with CRM. Its stock quoter is CRM. Like Benioff, its leaders are also active supporters of CRM. Sales force uses its cloud infrastructure on a community platform of loyal users, and the solutions developed for customers ultimately belong to Sales force products.
Sales force customers often don’t compare it to Azure or AWS. Instead, compare it with other CRM applications. This is because Azure and AWS have completely different models from Sales force. AWS is designed to “enable developers and businesses to use web services to easily build and pay for complex, scalable applications.” And Microsoft’s definition of Azure is “an expanding set of cloud services that can help businesses meet business challenges.”
Neither Microsoft nor Amazon are CRM companies, but cloud service companies that host a large number of applications, some of which happen to be CRM companies.
Is Google aware of this?
Just as fans of a baseball team will buy tickets for star-watching players, merging Sales force and placing cloud computing on top of CRM priority will it keep CRM loyal users away? When Google introduced some unrelated applications and its own search and advertising tools to the new platform, how long would it take to downplay Sales force’s original brand. If that’s the case, Benioff may not stay under Google. The community he built may have faded.
Maybe Google understands this and doesn’t care. But you really should care. This is because if Google abandons Sales force’s core CRM application, then just like teams that abandon core players, those core people who have been successful with Sales force’s cloud technology will also leave.
If so, whether Google’s acquisition can achieve its ambitious goals is still uncertain.