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Salesforce and Oracle Link Clouds

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Posted June 26, 2013 By Pedro Hernandez     Feedback

Business software rivals ink a nine-year deal that will bring their clouds closer together.

Salesforce and Oracle, whose outspoken CEOs have often traded barbs, announced this week that they have entered into a nine-year partnership that will see the company's adopt each other's tech across the entire cloud computing stack.

As part of the deal, Salesforce will "standardized" on Oracle. The cloud customer relationship management (CRM) software specialist will runs its data center operations on Oracle's database, Linux OS, Java Middleware platform and Exadata database servers, the companies announced.

The move may put Saleforce's rumored transition to an open source database on ice, at least for now. Currently, Oracle supplies Salesforce's database backend.

Last month, the company made waves when it was revealed that a top PostgreSQL contributor, Tom Lane, had taken up residence at Salesforce. Lane told Wired.com recently that "Salesforce is interested in expanding their use of Postgres, and I'll be advising the team that is working on that."

Meanwhile, Oracle said that it "plans to integrate salesforce.com with Oracle's Fusion HCM and Financial Cloud," applications that Salesforce in turn will adopt company-wide.

"Salesforce.com's CRM integrated with Oracle's Fusion HCM and Financial Cloud is the best of both worlds: the simplicity of salesforce.com combined with the power of Oracle," said Salesforce CEO Marc Benioff in a statement. Remarking that he's looking forward to working with his company's rival, Oracle CEO Larry Ellison portrayed the deal as a customer-friendly move.

"When customers choose cloud applications they expect rapid low-cost implementations; they also expect application integrations to work right out of the box – even when the applications are from different vendors. That’s why Marc and I believe it’s important that our two companies work together to make it happen, and integrate the salesforce.com and Oracle Clouds," stated Ellison in company remarks.

A research note from financial analyst firm Stifel raised the possibility that Salesforce and Oracle are closing ranks to guard against a rising upstart.

"Of course, the sudden decision for salesforce.com and Oracle to play nice raises a variety of questions with broader-reaching implications," wrote Stifel analysts Tom M. Roderick and Gur Talpaz. "Are both parties nervous enough about the rapid ascent of Workday so as to join forces to combat that rise?"

The analysts also wondered if the Salesforce is "implicitly endorsing [Oracle] as the back-office complement to its front office leadership." Both scenarios are more valid than the idea that Benioff will sell Salesforce to Ellison any time soon, concluded Roderick and Talpaz.

Pedro Hernandez is a contributing editor at Enterprise Apps Today and InternetNews.com. Follow him on Twitter @ecoINSITE.

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