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Originally published May 29, 2014 at 7:58 PM | Page modified May 29, 2014 at 10:10 PM

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Microsoft, Salesforce.com bury hatchet as they forge product alliance

The two rivals put aside the boxing gloves — at least for now — announcing a partnership that connects Salesforce.com’s apps and platform to Microsoft Office and Windows


Seattle Times technology reporter

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Over the years, Microsoft and Salesforce.com have traded lawsuits, barbed swipes and fierce jabs as they competed in the customer-relationship management market.

But Thursday, the two rivals put aside the boxing gloves — at least for now — announcing a partnership that connects Salesforce.com’s apps and platform to Microsoft Office and Windows.

In fact, Salesforce.com Chairman and CEO Marc Benioff described the partnership, forged with new Microsoft CEO Satya Nadella, in such glowing terms, it verged on the bromantic.

The often blustery Benioff, who has in the past described Microsoft as irrelevant and a disaster, emphasized repeatedly how happy he was with the new relationship.

“I just want to say how absolutely thrilled I am to be partnering today with Satya,” Benioff said during a conference call with analysts and media. “It’s been absolutely great working on this agreement together. I just couldn’t be happier with how things have gone.”

“I’ve always wanted to have a closer relationship with Microsoft. And now we do,” said Benioff, who tweeted a few pictures of him and Nadella together Thursday.

Nadella, for his part, was less effusive but nonetheless talked about how pleasurable it was working with Benioff and his team.

“I couldn’t have been more pleased that we’re partnering across many areas of our business,” Nadella said.

That’s quite a change from the companies’ formerly combative relationship.

Microsoft, with its Dynamics CRM products, and Salesforce.com are rivals in the customer-relationship-management (CRM) software and services market.

They’ve battled on several fronts.

In 2010, Microsoft filed a lawsuit saying Salesforce.com’s customer-relationship management software infringed on some of Microsoft’s patents. Salesforce.com countersued before the two companies eventually settled.

Also that year, Microsoft ran an ad in the form of an open letter to Salesforce.com (and Oracle) customers, offering them financial incentives to switch to Microsoft’s products.

It also periodically has run an ad campaign against Salesforce.com named “Don’t Get Forced.”

Benioff, meanwhile, has often taken jabs at Microsoft, calling the company the “evil empire” and likening its Surface tablet to a former girlfriend who was “fast, pretty and way too complicated to ever understand.”

So what led to the new warm-and-fuzzy relationship unveiled Thursday?

Nadella’s ascension to the helm of Microsoft in February this year likely was a major factor, Benioff hinted during the conference call.

While the relationship between the two companies has evolved over the years, “when Satya became the CEO of Microsoft, that gave us the opportunity to have an even stronger relationship with Microsoft,” Benioff said.

With the partnership, the companies are bringing Salesforce1 to Windows and Windows Phone 8.1, allowing customers to access Salesforce from their Windows devices. It is expected to be available for preview this fall with general availability next year, according to the companies’ news release.

The partnership also entails new interoperability between Salesforce and Office 365, including the ability to edit and collaborate on Office content from within Salesforce and on Salesforce 1; to use Salesforce and Outlook together with a new Salesforce app for Outlook; and to connect Salesforce data to Excel and Power BI for Office 365.

Salesforce.com also will be using SQL Server and Microsoft Azure more extensively within its organization.

Terms of the partnership were not disclosed.

Both CEOs touted the value of the partnership for their customers.

“This partnership is about helping customers extract more value from our technologies,” Nadella said.

Nadella sidestepped a later question about what the partnership means for Microsoft’s own Dynamics CRM line, saying only that Thursday’s announcement was focused on the Salesforce.com partnership.

Kirill Tatarinov, head of Dynamics, wrote a blog post later Thursday saying the partnership was an “inspiring example” of two companies that would continue to compete while also finding “ways to come together to benefit our customers.”

Nadella hinted such relationships with rivals might happen more in the future.

“We want to be a broad platform provider in this mobile first, cloud first world,” he said. “So partnerships like the one that we’re talking about with Salesforce today is very, very important to us.”

“This is definitely indicative of a new era at Microsoft,” Al Hilwa, an analyst with research firm IDC, said in an email.

“This is also about interoperability at multiple levels which will help customers of both companies,” Hilwa said. “Supporting Salesforce with Microsoft’s client platforms is strategic win for Microsoft as it pushes its mobility strategy in the enterprise, and broadening the access to the Salesforce apps from Microsoft’s platforms and ubiquitous Office apps is a strategic win for Salesforce.”

Janet I. Tu: 206-464-2272 or jtu@seattletimes.com. On Twitter @janettu.



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