No longer living in cloud cuckoo land
Cloud computing isn't just candyfloss thinking – it's the future. So believes Marc Benioff, head of salesforce.com
"What if salesforce.com were switched off," asks a concerned customer. The question is addressed to Marc Benioff, the company's charismatic 44-year-old chief executive, during the Cloudforce conference at the ExCel Centre in London last week.
It's a big question, as salesforce.com is a prime example of cloud *computing, asking customers to entrust business- critical software and data to servers running on the net. Benioff doesn't answer directly, but speaks with passion. "This is the future," he says. "If it isn't, I don't know what is. We're in it. You're going to see this model dominate our industry."
Benioff co-founded salesforce.com in 1999, creating a company that specialises in enabling sales teams to manage contacts and leads online. Growth has been rapid, and revenue passed $1bn in the last financial year, despite the downturn. "For the fiscal 2009 (which ended in January), our revenue increased 44%," he says.
Although the company's core product remains customer relationship management (CRM), its scope has expanded. "There are three core areas for us: the sales cloud, the service cloud, and your cloud," says Benioff. When he says "your cloud" he means custom applications, developed by customers or third parties but running on the salesforce.com servers.
A different type of support
The service cloud is new. The idea is that customer support now belongs on the internet, not in call centres. "How many people here have gone to Google when you had a problem with a product or service?" asks Benioff at Cloudforce. "You didn't make a call, did you? It's changed." The service cloud, already used by Orange, lets companies create a web portal with links to online chat, web search, and social *networking services such as Twitter.
Salesforce.com is not alone in its cloud ambitions. Google will run your email, host your documents, and now provides a platform for custom applications called App Engine. Amazon has fast-growing web services that let you set up virtual servers in the cloud and Microsoft has a new cloud initiative called Windows Azure.
Talking to the salesforce.com executives, it is clear who is regarded with warmth and who is not. "Azure is moving that old software from your data centre *to their data centre," says Benioff. "It seems as though they are moving all the complexity of the traditional development stack to the cloud, which misses the point." Google and Amazon, on the other hand, *are partners. "We have been working closely with the Amazon Web Services team so customers can connect our clouds seamlessly," he says. "Over time, we expect that there will be even more specialised clouds, but they will all be connected *via data and metadata APIs."
Maintenance costs
Organisations that build web applications may run them from the cloud, but still have the burden of maintaining and developing them. "Our technology is different, there is only one application," Benioff explains. This is called multi-tenancy, where many customers share the same software.
What about the Open Cloud Manifesto, a document put together by IBM and others to promote interoperability? "Cloud providers must not use their market position to lock customers into their particular platforms and limit their choice of providers," trumpets the manifesto. Its credibility is undermined by vagueness and the absence of many big names, including Google and Amazon. "We did not sign it," says Bruce Francis, vice-president for corporate strategy at salesforce.com. "We say, look at our actions," referring to integration efforts with Google, Amazon and Facebook.
Still, customer concerns are less about integration, more about lock-in. Once committed to salesforce.com's platform, can you ever get out? Maybe not. Benioff is open about what he calls strategic *relationships with customers. "It's an aspect of our industry. You are making a platform decision, and our job is to make sure you choose our platform and not another platform, because once you have chosen another platform, getting you off it is usually impossible," he said last year in San Francisco.
Moving to salesforce.com is no magic bullet. Kishore Sharma is CRM manager at Amtico International, a flooring company with around 400 employees. Four years ago, Amtico spent about £500,000 migrating to Salesforce CRM, but initially it failed. "We suffered with about 33% adoption. We didn't understand the application or how it should be married to our business." Amtico addressed the problems, fine-tuning the application and training users. Now adoption is over 90% and Sharma says Salesforce is valued for its flexibility and on-demand availability.
Another benefit is the ability to scale down as well as up. "We've had redundancies because we're in the manufacturing industry," says Sharma. "We've reduced the number of licences, we've negotiated a better price."
What then of that uncomfortable question – is data really safe in the cloud? "All complex systems have planned and unplanned downtime. The reality is we are able to provide higher levels of reliability and availability than most companies could provide on their own," says Benioff, who claims 99.9% uptime last year. There are now around 55,000 customers, forming 1.5 million subscribers, who are hoping earnestly that he is right.
Tim Anderson
The Guardian, Thursday 16 April 2009
guardian.co.uk © Guardian News and Media Limited 2009
Cloud computing isn't just candyfloss thinking – it's the future. So believes Marc Benioff, head of salesforce.com
"What if salesforce.com were switched off," asks a concerned customer. The question is addressed to Marc Benioff, the company's charismatic 44-year-old chief executive, during the Cloudforce conference at the ExCel Centre in London last week.
It's a big question, as salesforce.com is a prime example of cloud *computing, asking customers to entrust business- critical software and data to servers running on the net. Benioff doesn't answer directly, but speaks with passion. "This is the future," he says. "If it isn't, I don't know what is. We're in it. You're going to see this model dominate our industry."
Benioff co-founded salesforce.com in 1999, creating a company that specialises in enabling sales teams to manage contacts and leads online. Growth has been rapid, and revenue passed $1bn in the last financial year, despite the downturn. "For the fiscal 2009 (which ended in January), our revenue increased 44%," he says.
Although the company's core product remains customer relationship management (CRM), its scope has expanded. "There are three core areas for us: the sales cloud, the service cloud, and your cloud," says Benioff. When he says "your cloud" he means custom applications, developed by customers or third parties but running on the salesforce.com servers.
A different type of support
The service cloud is new. The idea is that customer support now belongs on the internet, not in call centres. "How many people here have gone to Google when you had a problem with a product or service?" asks Benioff at Cloudforce. "You didn't make a call, did you? It's changed." The service cloud, already used by Orange, lets companies create a web portal with links to online chat, web search, and social *networking services such as Twitter.
Salesforce.com is not alone in its cloud ambitions. Google will run your email, host your documents, and now provides a platform for custom applications called App Engine. Amazon has fast-growing web services that let you set up virtual servers in the cloud and Microsoft has a new cloud initiative called Windows Azure.
Talking to the salesforce.com executives, it is clear who is regarded with warmth and who is not. "Azure is moving that old software from your data centre *to their data centre," says Benioff. "It seems as though they are moving all the complexity of the traditional development stack to the cloud, which misses the point." Google and Amazon, on the other hand, *are partners. "We have been working closely with the Amazon Web Services team so customers can connect our clouds seamlessly," he says. "Over time, we expect that there will be even more specialised clouds, but they will all be connected *via data and metadata APIs."
Maintenance costs
Organisations that build web applications may run them from the cloud, but still have the burden of maintaining and developing them. "Our technology is different, there is only one application," Benioff explains. This is called multi-tenancy, where many customers share the same software.
What about the Open Cloud Manifesto, a document put together by IBM and others to promote interoperability? "Cloud providers must not use their market position to lock customers into their particular platforms and limit their choice of providers," trumpets the manifesto. Its credibility is undermined by vagueness and the absence of many big names, including Google and Amazon. "We did not sign it," says Bruce Francis, vice-president for corporate strategy at salesforce.com. "We say, look at our actions," referring to integration efforts with Google, Amazon and Facebook.
Still, customer concerns are less about integration, more about lock-in. Once committed to salesforce.com's platform, can you ever get out? Maybe not. Benioff is open about what he calls strategic *relationships with customers. "It's an aspect of our industry. You are making a platform decision, and our job is to make sure you choose our platform and not another platform, because once you have chosen another platform, getting you off it is usually impossible," he said last year in San Francisco.
Moving to salesforce.com is no magic bullet. Kishore Sharma is CRM manager at Amtico International, a flooring company with around 400 employees. Four years ago, Amtico spent about £500,000 migrating to Salesforce CRM, but initially it failed. "We suffered with about 33% adoption. We didn't understand the application or how it should be married to our business." Amtico addressed the problems, fine-tuning the application and training users. Now adoption is over 90% and Sharma says Salesforce is valued for its flexibility and on-demand availability.
Another benefit is the ability to scale down as well as up. "We've had redundancies because we're in the manufacturing industry," says Sharma. "We've reduced the number of licences, we've negotiated a better price."
What then of that uncomfortable question – is data really safe in the cloud? "All complex systems have planned and unplanned downtime. The reality is we are able to provide higher levels of reliability and availability than most companies could provide on their own," says Benioff, who claims 99.9% uptime last year. There are now around 55,000 customers, forming 1.5 million subscribers, who are hoping earnestly that he is right.
Tim Anderson
The Guardian, Thursday 16 April 2009
guardian.co.uk © Guardian News and Media Limited 2009
