If there’s one thing we know about Microsoft (News - Alert), the company doesn’t like to play second place to any other provider. Word processing software made sure it was the first in line in the corporate office, knocking out Apple (News - Alert) and even Xerox as a key player. The company has fought with both Google and Apple to dominate in a number of key areas, but the ability to knock Salesforce off its pedestal has got to make Bill Gates (News - Alert) feel pretty good.
Of course, people were relying on Word and Excel to support their office documents long before we ever heard of the cloud or tried to access information “on-demand”. Still, Salesforce was one of the first to understand the power the Internet presented when it comes to information exchange and the enterprise cloud was born. The company staked its claim as the leading provider of SaaS (News - Alert) solutions and companies jumped on board.
But Microsoft did not want to be outdone, especially in an industry it once dominated. Therefore, the software giant set its sights on the enterprise cloud and now, according to the Q2 report from Synergy (News - Alert) Research Group, it’s winning. A recent Seeking Alpha piece highlighted the report that shows Microsoft is now the overall leader in the global enterprise SaaS market. As recent as last year, the company could only claim a number two spot at 7.9 percent of the market share. Now, Microsoft claims 15 percent, beating Salesforce’s 14 percent for the second quarter.
Experts anticipate that this market lead in the enterprise cloud space won’t deviate anytime soon. Not only does Microsoft offer SharePoint and Office 365, it is now providing its $7/month Windows 10 Enterprise E3 product, helping to shift the focus from on-premise installations to cloud-based subscriptions. The company may have had to abandon the Zune as Apple dominated with the iPod; but it simply set its energies where it knows how to win – the enterprise.
Of course we shouldn’t expect Salesforce to simply get out of the way and allow its market share to dwindle. But this shift in the market will put more pressure on the company to shore up its offerings and its AppExchange to ensure they are able to meet with current user demands. At the same time, competition will continue to come from other areas. Google is another one that won’t be outdone if Microsoft is on the move.
It would be a shame if Salesforce were caught in that crossfire. Seeking Alpha suggests that Google’s Apps for Work has been left in the dust, but Google doesn’t generally go down without a fight. The rest of the story will be a fun one to watch play out, while we all benefit from the innovations that emerge.