“We have a UK customer which has two data centres. For 500 call centre agents, they had 500 servers in two data centres backed up doing disaster recovery,  running technology that they bought in 1995! You look at that and you go, this is just an opportunity for a great efficiency, great enhancement.” 

 

It's scenarios like that which, according to Salesforce.com CEO Marc Benioff, means that end users are waking up to “what a scam traditional enterprise software and hardware is” in an energy-constrained world. “This is the time we need to break out,” he argues.

 

The key to any such break out is Cloud Computing, he says. “It was just about 11 years ago when we asked ourselves the question why is all enterprise software not as easy to use as Amazon.com? No software to buy, no hardware to buy, nothing to install or upgrade or maintain,” he recalls.

 

It's a question being asked in even the most unlikely of quarters, he adds. “When companies like Microsoft now 10 years later, which have the most to lose from the declined software finally embrace Cloud Computing, you know there is no doubt in customer mind about where the future is headed - it’s headed towards Cloud Computing,” he says. 

 

That said,  not everyone gets the inevitability of this. e suggests. Benioff refers to firms such as SAP as being those “who kind of try to hold the Cloud Computing industry back. They provide all this kind of fear and uncertainty about lack of vision. They have really become the anti-Cloud in so many ways.”

 

But even the most devout of Cloud believers needs to be aware that there are changes afoot, he cautions. “The game is evolving again and we believe the stakes are even higher this time much, much higher,” he says. “Back in 1999 we asked that simple question about Amazon.com, but today the question has changed. The question is why is all enterprise software not like Facebook. On Facebook you don’t waste time searching for the right data going from app to app, the data finds you in real time. That’s what customer is getting, not from outdated collaboration applications like Microsoft Sharepoint and Lotus Notes”

 

Ah, Sharepoint! Benioff is now tangibly warming to his theme. “Sharepoint is owned by a lot of businesses, used by far fewer, and enjoyed practically by none,” he attests. “When was the last time everyone said they really loved using Microsoft Sharepoint or Lotus Notes? The reality is customers want to attract their co-workers who matter to them, the most critical conversations, the apps they depend on, the concept they create and share, all using the new mobile devices that they are carrying around in their hand. They want to collaborate without the cost, complexity and flexibility and overall enterprise dead weight of enterprise software, hardware and data centres.”

 

This is the thinking that's driving the new Chatter collaboration offering.  “Reaction has been incredible,” claims Benioff. “We believe that enterprises are more ready to cut their losses on sales collaboration apps like Lotus Notes and Microsoft SharePoint and join the conversation using Cloud Computing and Salesforce Chatter.” 

 

All of this is translating into success on the bottom line, says Benioff. “While most of the software companies went backwards last year, Salesforce.com went forward in a dramatic way, and more than a quarter of a billion dollars in operating cash flow and a balance sheet with more than $1.7 billion in cash and equivalents,” he says. “With more than 72,000 customers globally including an amazing 17,000 net new customers joining our ranks in the fiscal year, this represents a 31% year-over-year increase in our customer base, more than 2 million subscribers including more than 500,000 net additions during the year, an increase of roughly 35% year-over-year.

 

“We had a huge series of wins against Oracle including the Huntington National Bank, GE, Pfizer, KCI, Autodesk, BT and Aramark. We won impressive business against Microsoft during the quarter at many companies including Univision, Aspen Pharmaceutical, Cross National Bank, Cuna, Ingenix and SageCom. Finally we beat SAP at Schneider Electric, SAS, Noble Biocare Services AG, Kimberly-Clark, Bridgestone Golf and Walters Kluwer.

 

“These customers are coming to us because they want the most innovative products and services and in the enterprise today. Not just the best products in the cloud but the best products available period and they are coming in in ever increasing numbers. For the full year, we added more than 17,000 net new customers. That’s more customer additions than we recorded in our first six full years of being in business.”

 

 

There's a growing shift towards revenues coming from areas outside of Salesforce.com's traditional core Sales Force Automation sector with growth for the firm's Service Cloud offering. “We delivered our most diverse quarter of new business ever with more than 30% of our new business coming from non SFA services compared to 25% a year ago,” notes Benioff. “That’s a pretty amazing achievement when you consider that our core SFA, Sales Cloud business continues to grow at a strong double-digit clip.

 

“Just a year after its launch, the Service Cloud is on fire and this killer app is clearly our next lever of growth,” he adds. “New business volume for the Service Cloud more than doubled from the year ago quarter, as did the volume of Service Cloud transactions.” Recent Service Cloud customers include the Huntington National Bank, Dun & Bradstreet, Bausch & Lomb, Wyndham Hotel Group, Wells Fargo Bank, FBL Financial, Allianz and Chronopost.

 

Attention is now focusing on the firm's Service Cloud 2 offering. “Customers need the next generation of customer service and support, customer portals and call centre solutions,” says Benioff. “Customers realize that the call centre of the ‘90s won’t work in the age of social computing. It is abundantly clear that our competitors in this space just can’t keep up. Traditional customer service vendors still regard the web itself as foreign territory.”

 

There's also growing traction for the Custom Cloud offering for developing custom applications on the Force.com platform.  “While companies are poised to build for the future they are not going to double down on the software mistakes of the past using old technology like Microsoft .NET,” insists Benioff. “Avon, McGraw-Hill, Fairchild Semis and Honda all now are Force.com customers building the next generation of applications of Cloud Computing, their custom apps, their private Cloud apps on Force.com.”

 

In conclusion, Benioff clearly sees himself in the right place at the right time. “We just went through one of most horrific times of all time for technology spending, one of the most difficult times for a lot of companies and certainly difficult times for our peers,” says Benioff. “Yet, Salesforce.com kind of sailed through it really well.

 

“There were times, of course, where we had a slight downtick in bookings and we had a slight uptick in attrition, but at the end of the day, we came through this stronger and better, more differentiated and ready to compete in this market than ever before. In terms of a ship that went through a difficult storm, we came out the other side with no damage.”