Salesforce buys Mulesoft for $6.5 billion

Salesforce.com Inc, the cloud-based CRM company is continuing its recent acquisitions with the announcement that they will purchase Mulesoft for approximately $6.5 billion. The sale is expected to close at the end of July 2018.

The acquisition of Mulesoft will allow Salesforce to target specific sectors such as health care, financial services and government agencies and expand their Platform-as-a-Service portfolio of products and allow their customers to change and innovate faster, deliver better customer experiences, and increase their own operational efficiency.

Mulesoft’s current customers include such names as Coca-Cola, Barclays and Unilver, providing them with a platform for building application networks that connect enterprise applications, data and devices, both cloud and on-premise.

These platforms enable companies to build applications that suit their specific needs, and pull together data and applications from different sources. The addition of Mulesoft’s technology will allow Salesforce to create an integrated cloud service that combines the best of traditional in-house corporate computing with data and apps from the public internet.

Mulesoft technology makes it much easier for a company that wants to combine various apps, for example, Google Maps, and digital payment capabilities such as those from Braintree, with older software programs and data by pulling everything together, whereas without this technology a company would need to write custom code which may, or may not, even be possible for them.

Salesforce’s goal to double its annual revenue by 2022 to $22 billion will be helped by this purchase, as Mulesoft has been rapidly expanding by connecting applications, data sources and devices using in-house servers or public cloud providers for clients such as McDonalds Corp.

The purchase of Mulesoft will be Saleforce’s largest acquisition ever, and follows its recent acquisition of CloudCraze, the provider of B2B e-commerce technology built on Salesforce’s Force.com platform. It also acquired Demandware in 2016, to offers a retail industry focused Commerce Cloud e-commerce platform. With MuleSoft, it will be able to provide customized integrations of multiple applications to better compete in the business software market.

As both Salesforce and Mulesoft continue their combined technology development, they aim to accelerate customers’ digital development, enabling them to utilize data, cloud apps and devices for a better connected customer experience.

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Amazon Competes for Government Contracts

When you mention Amazon to many people they immediately think of Amazon shopping and Prime delivery, but not as many are aware of the huge inroads that Amazon has made over the past years into cloud computing.

It has been reported that the Pentagon has opened a competition for a multi-billion-dollar cloud services contract, which many of the big players such as Microsoft, IBM and Oracle fear will favor Amazon.com Inc.

Many of the companies looking to compete for government contracts had been pushing for the use of multiple cloud providers, however, the Pentagon announced on March 7 that it was planning to go forward with a single company.

US Department of Defense Chief Management Officer, Jay Gibson, has confirmed that this will be a multi-billion-dollar contract due to the Defense Department’s current technology needs.

The Pentagon confirmed that it intends to strengthen its use of emerging technologies, such as artificial intelligence, machine learning and internet of things and for this reason is switching to cloud services.

As Amazon has already won two huge Defense Department contracts for cloud services, others in the industry believe it is in a good position to win this contract. Whilst the Pentagon’s contracting office stated that they had no preference in contractors, offering the contract to a single vendor, not only causes those who do not win the contract to be locked out of the market for 10 years, it also creates problems for existing government contract vendors, such as Oracle.

Oracle currently has long-term contracts with several government agencies that use its database to store information on their own systems, and switching to cloud computing, would seriously affect Oracle’s traditional source of revenue.

In February of this year a contract was awarded to REAN Cloud LLC, an Amazon partner for a reported value of $950 million, and although this contract was later challenged by Oracle and then reduced to $65 million, it still worries some that Amazon is now the leader in cloud services.

There is no question that the Pentagon’s planned transition to the cloud will threaten on-site database providers such as Oracle and IBM, and while other vendors plan to emphasize their strengths to win this contract, it will be interesting to see which company is ultimately awarded the contract.

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