Tomorrow, Salesforce.com (CRM) and Google (GOOG) are expected to announce a strengthening of their ties in the area of enterprise applications. (Perhaps Salesforce customers will get a special deal when buying Google's AdWords, or perhaps Gmail, Google Maps, and other Google Apps will be more tightly integrated into Salesforce.com. Update: It turns out the two companies are announcing a"global strategic alliance" making it easier for companies to buy and manage their AdWords campaigns from inside Salesforce.com. Last year, Salesforce bought a startup called Kieden that does the same thing, so this is likely a formal extension of that).
Partly because of that alliance, Salesforce's stock has been on a tear this past month. There's even been talk of an outright acquisition by Google. Salesforce's $5.4 billion market cap would make it Google's biggest deal yet.
Although it's unlikely, Michael Arrington of TechCrunch makes a persuasive case for such a deal. Excerpt:
The future of software delivery is the browser. Google’s betting on it. Salesforce has already made a business at it.
Google wants Salesforce. Google Office fits perfectly with Salesforce CRM and App Exchange. Google can take all of it offline with Gears. And Salesforce can sell it with their existing sales team. And the timing is right - Benniof is signalling that he is ready to retire.
But Microsoft can’t let that deal happen, and is very likely to enter a bidding war to try to keep Google and Salesforce apart.
While Google could use a sales team that targets enterprise software customers, don't underestimate the value to Google of Salesforce.com's considerable Web-based software talents. In particular, it's Apex development platform solves some thorny issues with Web-based software. Combine that with Google Gears, which turns Web apps into offline desktop apps, and you can see how such a deal might worry Microsoft.
Of course, this is all just idle (but fun) speculation.