Amazon and Salesforce are deepening their ties to fight Microsoft and Google

Amazon Web Services and Salesforce are taking the next step in their relationship by deepening an existing tie-up.

The two firms said Wednesday that they are more closely integrating their respective technologies so that customers will be able to more easily build and use corporate apps powered by both AWS and Salesforce. Executives from the companies declined to comment on the financial value of the expanded partnership.

Patrick Stokes, Salesforce’s executive vice president of platform, said the deal is significant as the two businesses are “unifying our two platforms, and we’re doing it because our customers are asking us to do it.” Some of the companies’ joint customers include Swiss pharma giant Novartis and South Africa’s Standard Bank.

Best of both worlds

Traditionally, companies who use the two services had to do their own custom software tinkering to enable their Salesforce apps to work with AWS’s cloud-computing service. Now much of that back-end effort will be made unnecessary. A company that stores inventory records in AWS, for example, will be able to automatically present that data to its salespeople via Salesforce without having to do any custom coding, said Rachel Thornton, AWS’s vice president of marketing.

Other new features accompany the alliance. Companies will be able to manage their various AWS and Salesforce apps, and employee access and permission protocols, from both of the company’s IT management consoles. Salesforce also plans to integrate some of Amazon’s services, like its voice and video technology, Stokes said.

Salesforce plans to incorporate Amazon’s A.I. services too. The software combo will let customers do tasks like analyze sales call transcripts to identify effective sales techniques or coach junior salespeople. Although Salesforce previously used its in-house A.I. team to develop some of these A.I. powered call-transcription features, Stokes said that using Amazon “will improve those capabilities.”

The new offering will be available in early 2022, after a period of testing, Stokes said.

Cloud warfare

Daniel Newman, principal analyst at Futurum Research, an IT market research firm, said the expanded partnership is a big deal because it underscores the increased competition both companies are facing from other tech giants, like Microsoft and Google.

Amazon’s core cloud service is still the market leader in cloud computing. But Microsoft and Google are both quickly growing their respective cloud-computing services, posing a challenge to AWS, Newman said. A recent report from analyst firm Canalys estimated that AWS represents 37% of the overall $18.6 billion in cloud infrastructure spending for the first quarter of 2021, followed by Microsoft’s Azure service at 23% and Google Cloud at 9%. Microsoft just crossed the $2 trillion value mark on Tuesday, driven by Azure’s booming growth and related cloud and business software services.

Meanwhile, as Salesforce expands its services to provide more general business tools, as exemplified by its recent $24.7 billion purchase of work-chat app Slack, the Marc Benioff–led company faces tough competition from Microsoft and Google, two titans of general business software.

The partnership puts a damper on industry speculation that Salesforce might debut its own cloud-computing service akin to AWS, Microsoft Azure, or Google Cloud. “The market has been pondering Salesforce’s next move,” Newman said. “Everyone was like, is Benioff going to make a run in the public cloud?”

With this partnership, however, Salesforce appears to be saying, “We are going to hitch our wagon to AWS,” Newman said.