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Salesforce, HP pit newly grown 'Superpods' against Amazon jungle

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Salesforce is partnering with Hewlett-Packard in a huge strategic nudge to make Marc Benioff’s cloud company more like Amazon.

Salesforce today announced it is giving customers the option of taking out dedicated instances on its vaunted multi-tenant cloud. This marks the first time the customer relationship management (CRM) and cloud computing firm has offered this option.

But you won’t get dedicated instances on the main Salesforce platform itself. Rather, instances will only be available on servers supplied by PC and server maker Hewlett-Packard that are installed and managed in Salesforce’s mega data centres.

Salesforce has run its data centres on Dell since 2008, when The Register exclusively revealed the company was ripping out its Sun Microsystems’ E25K Spac boxes for clusters of low-priced Dell clusters.

The Superpods will mark the first time since that that non-Dell servers have been allowed into the online-CRM provider’s data centres.

Salesforce and HP said they will jointly develop and market Superpods to “the world’s largest enterprises.”

The two firms are expected to announce Superpods later today, on the opening of the former’s Dreamforce conference in San Francisco, California.

Superpods will be unveiled by embattled HP chief executive Meg Whitman, whose truing to turn her own computer and server maker into a cloud service provider.

No more technical details were available at time of writing.

In a canned statement, HP’s chief said: “By jointly developing and using each other’s technology, the Salesforce Superpod will deliver the highest standard in performance, reliability and management. HP intends to be the first customer of the Salesforce Superpod.”

Coming up against Amazon

Dedicated instances aren’t new to cloud service providers. Amazon gave customers on EC2 the option for dedicated instances in 2011.

It was a major departure for Amazon. Until then, it had simply offered an egalitarian and shared virtual service running on the same hardware.

But this was of no use to big customers, the kinds of “large enterprises” that Salesforce is gunning for – which want the convenience of not owning their own servers without the accompanying lack of control.

Amazon's dedicated instances introduced the kind of hardware isolation HP now seems to be giving Salesforce with Superpods.

Over to Amazon:

“They [customers] have asked for hardware isolation so that they can be sure that no other company is running on the same physical host.”

Dedicated instances is a major departure for Salesforce, which has been the poster child of shared, but secure, instances through its multi-tenant model.

It’s a model even Oracle’s Larry Ellison, who held out against the cloud for years, has been forced to embrace in his 12c database this summer.

Salesforce’s conversion comes at what looking like an inflexion point for the hosted CRM provider. The company is clearly concerned over its long-term position as the centre of an ecosystem for developers and as library for large amounts of business applications and customers’ business-critical data.

Meanwhile, Amazon has only strengthened its position in this space.

On Monday it emerged that Salesforce is shaking up its mobile strategy, killing existing mobile versions of its CRM for versions for Apple’s iOS and Android as well as integrating its CRM with other cloudy biz apps – such as LinkedIn and Dropbox.

A few weeks back, Salesforce said it would allow customers to strip the official branding from its AppExchange and run private versions of its store, Private AppExchange.

The news comes as Salesforce narrowly beat analyst estimates for its fiscal third quarter, with revenue growing 36 per cent to $1.08bn. That includes an expected boost by taking ownership of email marketing specialist ExactTarget.

The company issued full-year guidance of between $5.15bn and $5.20bn.

Chief executive Marc Benioff boasted Salesforce would become "the first enterprise cloud company to deliver more than $5bn in revenue next year".

Almost all of Salesforce’s money for the third quarter, $1bn, came from the core CRM business, with scrapings coming from other assets like Heroku.

Customers simply don't get or don't want the "social enterprise" varnish - they want compute and storage without the ownership.

Benioff revealed the failure of social enterprise during his Q3 conference call with Wall St. He told analysts: “You probably remember that a couple years ago we were really focused on defining the social and enterprise and that was very exciting to us... a highly collaborative enterprise built on social technologies.

“What we recognise was, when we went into a customer, who is the buyer of the social enterprise... it was a little tricky to find that buyer. Now when we go in to find the sales cloud buyer, the service cloud buyer, the marketing cloud buyer, the platform buyer, we know who they are and that has been an accelerator on our growth.”

The new target is the cloud purchaser in big companies in all departments interested in compute, storage and development, he added. The company would also be looking to make cost savings, he said. ®

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