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Salesforce is For Sale?

ForSale

Bloomberg published a story suggesting that Microsoft is making a $50 billion or so play for Salesforce. Salesforce hasn’t made a profit since 2011 but I did not get a sense that it needed to be acquired.

Quartz has four reasons why Microsoft won’t buy:

1. It”™s a huge price tag

Salesforce currently has a market capitalization of $47.7 billion, and since Microsoft isn”™t the only interested party, it seems all but certain that the acquirer will pay a significant premium. Forrester analyst Andrew Bartels estimates the price tag to be closer to $55 billion to $60 billion. “For that reason alone, it looks implausible,” he tells Quartz. Jeffries analysts note that would represent about two years of Microsoft”™s free-cash flow. (The company does have some vast cash reserves, but most of it is held overseas for tax purposes.) “They can afford it. Question is: Would they want to put so much in this position?” asks Bartels.

2. The math doesn”™t work

According to SeekingAlpha, this deal would boost Microsoft”™s revenue by 6%, but only in exchange for 13% of its equity. The hefty price tag means Microsoft”™s earnings would also take a big hit””as much as 18% by one estimate””and offsetting the decline might require billions of dollars in cost cutting.

3. Oracle might swoop in

Right now, most signs seem to point to Oracle as the the unnamed company that has already approached Salesforce””thus piquing Microsoft”™s interest. There are only so many companies that could make such an acquisition, and Bartels says SAP and IBM are stretched too thin to shell out $50-plus billion. That leaves Oracle, which happens to be Salesforce CEO Marc Benioff”™s old stomping grounds. It”™s possible Oracle might view such a merger as a succession plan (albeit a very expensive one), with Benioff taking the reins in the near future.

4. Benioff might not want to sell

Though Salesforce hasn”™t turned a profit since 2011, its business is growing at a healthy clip. It hit $5 billion in revenue faster than any other software vendor in history, according to Forrester. In the last three years, it has averaged 33% in revenue gains. “I think all things considered, Benioff would like to keep Salesforce independent,” says Bartels. “It”™s growing well. There”™s no need for an acquisition.”

Leadership Insight

Steve Jobs made some interesting observations at an industry interview last night.

On his return to Apple in the 1990s:

“Apple was about 90 days from going bankrupt. It was much worse than I thought back then. I expected all the good people had left, but I found many of them still there, and I asked them, “Why are you still here?” They said it was because they believed in Apple.”

On the platform wars between Microsoft, Google and Apple:

“I don’t see it. We never saw ourselves in a platform war with Microsoft, and maybe that’s why we lost. We think about the competition, but we’re focused on building a better product.”

On passing Microsoft’s market capitalization:

“It doesn’t matter very much. It’s not what’s important. It’s not what makes you come to work in the morning. It is a little surreal.”

On Google:

“They decided to compete with us. We didn’t go into the search business! We want to create better products than them. If people like our products, we get to come to work for tomorrow. Just because we’re competing doesn’t mean we have to be rude.”

On journalists and, er, bloggers:

“The foundation of a free society is free press, and some of the newspapers are in real trouble. I don’t want to see us descend into a nation of bloggers. I’m all for anything that can help newspapers with new ways of expressing themselves and getting paid. We need editorial oversight now more than ever.”

On the future of PCs. They become farm trucks:

“When we were an agrarian nation, all cars were trucks because that’s what you needed on the farms. But cars eventually became more prevalent is people moved to cities. PCs will be like trucks…they are still going to be around, but there is a transformation coming, and it will make some people uneasy. Is it the iPad? Who knows? Will it be next year or five years from now?”

On his work:

“I have one of the best jobs in the world. I get to come in and work with some of the most brilliant people in the world. We play in the best sandbox. We’re structured like a start-up. We’re the biggest start-up on the planet. And we all meet once a week to discuss our business…and there’s tremendous teamwork at the top and that filters down to the other employees.”

On his Stanford address:

“Probably I would just turn up the volume on it. The last few years have reminded me that life is fragile.”

The Windows Era Is Over

Apple achieved a significant milestone today. They became the most valuable U.S. technology company with a market cap of $228.56 billion. They are now the second-largest U.S. company by market capitalization.

Apple’s market cap was $88.68 billion on Oct. 2, 2008 and Microsoft’s was $228.35 billion on Sept. 29, 2008. Microsoft’s market cap is virtually unchanged. Different story for Apple.

The Windows era is over.

Google Versus Apple

The following clip is an excerpt from The Pirates of Silicon Valley. It highlights how Microsoft conducted business back in the good old days.


A lot has changed since then.

First, Microsoft is a dead stick company. Unable to effectively innovate or grow the business, it clings to its old monopoly model of imposing a tax on PCs. A tax that is called Windows and, more often than not, Office. In terms of the next wave of computing, Microsoft is simply not a material factor. Microsoft does not lead or drive the market. Other competitors have moved in.

What is interesting is that the same techniques Microsoft used in the 1980s to dominate the PC industry is now being used by Google to dominate the 2010s. Google is playing hardball with its competitors and Google is winning.

When Schmidt joined the board of Apple in 2006, he made the following statement:

“Apple is one of the companies in the world that I most admire,”? said Eric Schmidt. “I’m really looking forward to working with Steve and Apple”™s board to help with all of the amazing things Apple is doing.”?

Or was there a different motive?

Android? Chrome? Google TV?

Google”™s VP of Engineering, Vic Gundotra made a particularly arrogant statement about why Google created Android:

If we did not act, we faced a draconian future. Where one man, one company, one carrier was the future.

Uh, huh. Conveniently forgetting to mention that Google had acquired Android in 2005. Before the iPhone. Before the Apps store. And conveniently forgetting to mention that Eric Schmidt was following the teachings of Sun Tzu’s Art of War:

If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.

In A Word, No

A Windows 7 stability fix breaks stability. Interesting to read the comments on the Technet Forum. Makes me miss the Windows platform.

I especially enjoy the comments from the Microsoft technical support folks. They are really trying to help. Like this comment. The key question comes at the end of his post.

You may update the BIOS and the hardware drivers first.

After that, I would like to suggest you disable the antivirus program and try to install the update KB977074 in Clean Boot manually again.

Here are the download links for the update KB977074:

Update KB977074 for Windows 7 32-bit: http://www.microsoft.com/downloads/details.aspx?displaylang=en&FamilyID=19e12856-4808-4fbf-b5c9-2dac4bbb48b6

Update KB977074 for Windows 7 64-bit: http://www.microsoft.com/downloads/details.aspx?familyid=86B3EDE2-84EF-44A0-8084-D65AF65482BE&displaylang=en

Does it work?

Microsoft’s Creative Destruction

Answer: Because Microsoft is clumsy and uncompetitive.

As they marvel at Apple”™s new iPad tablet computer, the technorati seem to be focusing on where this leaves Amazon”™s popular e-book business. But the much more important question is why Microsoft, America”™s most famous and prosperous technology company, no longer brings us the future, whether it”™s tablet computers like the iPad, e-books like Amazon”™s Kindle, smartphones like the BlackBerry and iPhone, search engines like Google, digital music systems like iPod and iTunes or popular Web services like Facebook and Twitter.

Harsh words about Microsoft in the New York Times.  Via.

Microsoft IE9

Microsoft is working on a better browser?

This comment from the post highlights the feedback I have heard from many web developers and their love for the IE browser:

Instead of focusing on things like: Direct2D and DirectWrite, please focus on better STANDARDS SUPPORT!

Will IE9 support default ECMAScript events instead of stupid IE proprietary ones?

Will it support as much css3 as other browsers do?

Innovation is fine when you aren’t so freaking behind on features other browsers have had for 5 years.

Stop innovating until you get IE9 up to speed with CSS, Box model, canvas, SVG, base64, @font-face, etc. Stop trying to create your own APIs before you implement standard ones!

Web developers hate you and recommend other browsers because of this asinine behaviour.

Windows 7 is Secure

Windows 7 is the most secure operating system ever.

Really. No, really.

And it generated this rebuke from Microsoft:

Microsoft is concerned that this new report of a vulnerability was not responsibly disclosed, potentially putting computer users at risk. We continue to encourage responsible disclosure of vulnerabilities. We believe the commonly accepted practice of reporting vulnerabilities directly to a vendor serves everyone’s best interests. This practice helps to ensure that customers receive comprehensive, high-quality updates for security vulnerabilities without exposure to malicious attackers while the update is being developed.