Welcome to the Cloud Wars Minute — your daily cloud news and commentary show. Each episode provides insights and perspectives around the “reimagination machine” that is the cloud.
This episode is sponsored by Acceleration Economy’s “Cloud Wars Top 10 Course,” which explains how Bob Evans builds and updates the Cloud Wars Top 10 ranking, as well as how C-suite executives use the list to inform strategic cloud purchase decisions. The course is available today.
00:17 — There’s a very interesting competition going on between SAP and Salesforce to become the world’s largest applications vendor. For close to five decades, it was SAP, which really invented the enterprise applications category. Then Salesforce, about a year ago, for the first time, had quarterly revenue that exceeded SAP’s, and that’s what happened in the most recent quarter.
01:17 — If we look at the last 12 months, SAP takes the number one spot at $33.78 billion, compared to Salesforce’s $33.07 billion. While SAP’s cloud revenue is growing twice as fast as Salesforce, to about 23%; Salesforce’s will be 11%. The counterbalance for SAP is its declining on-prem business. It’s got to keep its lead in cloud growth rate.
02:20 — Who is going to be the biggest apps vendor in the world? And secondly, who is going to be the third largest overall enterprise software vendor including databases, platforms, and so forth behind Microsoft and Oracle?
03:00 — Over time, the choices and favorites of customers shift. Early on, it was all Amazon, it was all Salesforce — that has changed dramatically. SAP and Salesforce are about as close in their total revenue size as any two companies could be. I would not be surprised if there are some customers who look at this and say, “I want to go with the winner here.”
04:16 — Marc Benioff, the CEO of Salesforce, mentioned in the company’s earnings call last week on August 30 that Salesforce has become the world’s third-largest software vendor. So, there are some bragging rights to be had here.