X
<

What Does Salesforce Think about the Microsoft-LinkedIn Deal?

PART:
1 2 3 4 5 6 7 8 9 10 11 12 13
Part 4
What Does Salesforce Think about the Microsoft-LinkedIn Deal? PART 4 OF 13

Why Salesforce Feels Threatened by Microsoft

SaaS is expected to be fastest growing cloud service

Earlier in the series, we learned that though Salesforce (CRM) leads the CRM (customer relationship management) space, the competition is heating up. Technology players are increasingly targeting CRM, as it’s the largest component of SaaS (software-as-a-service), the fastest-growing sector in the cloud computing space.

According to the Cisco (CSCO) Global Cloud Index, SaaS is expected to be the fastest-growing cloud service through 2018. SaaS is expected to grow at a compound annual growth rate (or CAGR) of 33%, whereas the cloud market as a whole is expected to grow at a CAGR of 24%. This explains Salesforce’s, Microsoft’s (MSFT), and Oracle’s (ORCL) increased initiatives to strengthen and scale up their positions in the CRM space.
Why Salesforce Feels Threatened by Microsoft

Interested in ADBE? Don't miss the next report.

Receive e-mail alerts for new research on ADBE

Success! You are now receiving e-mail alerts for new research. A temporary password for your new Market Realist account has been sent to your e-mail address.

Success! has been added to your Ticker Alerts.

Success! has been added to your Ticker Alerts. Subscriptions can be managed in your user profile.

Bidding wars are expected to intensify

Earlier, we also learned that Salesforce pushed Microsoft to raise its price for LinkedIn. Salesforce also faced a bidding war during its acquisition of Demandware, its largest acquisition to date. Market research company Stifel suspects that the other competitor in the Demandware bidding war was Adobe (ADBE). Not stating directly whether this was the case, Salesforce CEO Marc Benioff stated that it “was a very competitive deal.”

Bidding wars are only expected to become fiercer in the technology space, which is currently on an acquisition spree. In the words of Wedbush Securities analyst Steve Koenig, increased mergers and acquisitions are an “existential necessity” for companies in the tech space in order to achieve growth.

As mergers and acquisitions increase, so might companies’ initiatives to outbid one other, giving rise to increased bidding wars.

X

Please select a profession that best describes you: