Google and Salesforce Ink Cloud, Apps Deal

Google Cloud has picked up a marquee customer, Inc., as the Alphabet Inc. unit tries to keep pace with Inc. and Microsoft Corp. in the increasingly competitive business of providing web-based, on-demand computing services.

The deal, slated to be announced Monday at the start of Salesforce's Dreamforce customer conference in San Francisco, comes a year and a half after the cloud-based business software vendor said it would move some computing operations to data centers run by the market leader, Amazon Web Services. Salesforce also operates its own data centers.

World-wide revenue for the business of providing cloud infrastructure -- that is, computing processing and storage service -- hit $22.2 billion last year, and is expected to climb to $67 billion by 2020, according to industry research firm Gartner Inc.

One big cloud-infrastructure provider Salesforce hasn't partnered with: Microsoft's Azure service. Salesforce and Microsoft announced an alliance in 2014 to enable their products to work together smoothly, but Salesforce is facing increased competition in its core sales-force automation business from Microsoft's Dynamics applications.

Salesforce last year pressed regulators to scrutinize Microsoft's $27 billion acquisition of LinkedIn Inc., though the deal ultimately won approval and closed last December.

Google Cloud, meanwhile, is working to build credibility among corporations wary of committing to a company that has little experience supporting the technology needs of big companies other than its own. Its cloud-infrastructure service, which provides computing processing and storage from its massive data centers around the globe, trails Amazon, Microsoft and Alibaba Group Holding Ltd., according to industry research firm Gartner Inc.

Salesforce already is running its Advertising Studio service, which helps companies run digital ad campaigns, on Google Cloud, Salesforce Chief Executive Marc Benioff said in an interview.

"We will in short order have all of our products running on Google Cloud, " he said.

As part of their deal, Salesforce will offer Google's G Suite productivity applications free for up to one year to its customers who aren't already using them. Salesforce has more than 150,000 customers, and the company said less than half of them currently use G Suite.

"If people already have something else that they are using, this gives them a chance to experience" Google's apps with Salesforce services, Google Cloud CEO Diane Greene said in an interview. "It's a change for us to bring all of this to Salesforce's customers with very little friction."

Salesforce also intends to weave Google Analytics, which helps marketers analyze customer behavior, with its own Sales Cloud and Marketing Cloud services. The combined services are aimed at helping marketers more effectively target email campaigns.

Mr. Benioff acknowledged that money was being exchanged between the companies as part of the deal, but both he and Ms. Greene declined to disclose terms of the deal.

Write to Jay Greene at

(END) Dow Jones Newswires

November 06, 2017 16:19 ET (21:19 GMT)