Oracle Salesforce Rumor: A Summer Thriller
July 1, 2009
I heard chatter at the Gilbane conference in San Francisco on June 4, 2009. I did not know the slick, 20 something who was explaining over his Pop Tart that Oracle was interested in Salesforce.com. Now the story “pops” into my feed reader with a Reuters’ logo, a byline for Jim Finkle, and the rumor elevated to the status of mainstream media “story”. You can try to locate the Reuters’ story “Sales Force CEO Downplays Chatter of Sale to Oracle” but I have had some 404s of late. These Reuters’ stories are too valuable to be left where my feed reader first pointed. Go figure. Anyway, Mr. Finkle wrote:
Salesforce.com Inc Chief Executive Marc Benioff downplayed persistent speculation that bigger rival Oracle Corp may buy his Web-based software company. Oracle CEO Larry Ellison was an early investor and one-time board member in San Francisco-based Salesforce but Benioff told Reuters on Monday [June 29, 2009]: “If he wanted to buy it, he would have.”
A couple of thoughts flapped through the addled goose’s tiny brain:
- Google has been a cheerleader for Salesforce.com for quite a while. Google, however, has not made overt moves to acquire Salesforce.com. If Oracle shows interest, might that urge Googzilla to snap up Salesforce.com along with its real sales team and its customers.
- Despite Mr. Ellison’s investment in Salesforce.com, I have sensed some cattiness about Salesforce.com’s success with its off premises, cloud based service. Even though Oracle beats at the heart of the Salesforce.com system, the model challenges Oracle’s on premises approach. A purchase might lead to some sudden changes in Salesforce.com. I think of this management approach as oncology management.
- With a great deal of cash slopping around in some investment firms’ wallets, if Salesforce.com is in play, there may be some left field buyers in the game.
Nothing like a buy out rumor to add zest to the summer financial drama. My hunch is that this thriller may have a touch of Hollywood, however. Whatever happens, I think Google benefits. That company’s search and glue code makes contributions to both Oracle and Salesforce.com. Neither company has a search system that rises above unsalted popcorn. Google may end up a winner by providing search and other services no matter how the script unfolds.
Stephen Arnold, July 1, 2009
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A big question: should Oracle acquire SalesForce, will the many SalesForce existing customers that compete with Oracle give up SalesForce instead of paying money to their competitor Oracle?