Salesforce and Microsoft team up on mobile, Office 365

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The team-up nobody expected.

The Bloomberg report from yesterday is true: Microsoft and Salesforce are burying the hatchet and teaming up. Contrary to the report, that partnership doesn't involve the Microsoft Azure cloud platform, but rather will take the form of integrations with the Office 365 SaaS productivity suite and a native Salesforce1 app for Windows and Windows Phone. 

On a conference call with the press, Salesforce CEO Marc Benioff said that this announcement aligns the two companies' core strategies: new Microsoft CEO Satya Nadella is focusing on Office 365, while CRM is still the center of the Salesforce platform. Ultimately, both CEOs noted that this announcement is the result of customer demand. 

"The partnership with Microsoft fundamentally advances our goal of making our customers more productive and successful," said Benioff on the call.

Benioff also had some kind words for new Microsoft CEO Satya Nadella, specifically calling out his appointment to the position as a milestone that led to the two companies, formerly bitter enemies, partnering up. It's certainly a reversal of some of the invective Benioff threw at Nadella's predecessor Steve Ballmer. 

Salesforce1 for Windows and Salesforce1 for Windows Phone will both be available in limited preview this Fall, with a full release in early 2015, marking the first time the cloud giant brings a native app to Microsoft platforms.

The timing is interesting: the recently announced updates to the Salesforce1 app bring a mobile web version that was specifically shouted out as being perfect for Windows Phone users who didn't have an app of their own. Then again, that mobile web version will beat the native app to market. 

Meanwhile, the integrations between Salesforce and Microsoft Office 365 are both straightforward and potentially very useful: Users will be able to work with and collaborate on Office data from within Salesforce and Salesforce data from within Office, the two companies promise. 

"We will empower people to use Office 365 and Salesforce seamlessly together," Nadella said on that conference call.

Mutual customers of Salesforce and Office will have the option to store their data in OneDrive and SharePoint Online. A plugin for Microsoft Outlook will integrate Salesforce data. And Salesforce data can be imported directly to Microsoft Power BI and Excel for analysis and visualization. 

It's pretty basic, truth be told, and mostly hinges on integrating data sources -- a slight disappointment given the rumors swirling around (one source held that Microsoft would offer Salesforce CRM directly from Azure) ahead of this announcement.

But it certainly makes sense that Microsoft wouldn't want to encourage competition with its own Dynamics CRM product. For Salesforce's part, it puts new tools into the hands of its existing customers and can potentially drive adoption of its core CRM product by validating their existing Office investments. 

And as a brief aside, Benioff noted that the ExactTarget marketing cloud, acquired by Salesforce for $2.5 billion last year, will continue to be hosted on Microsoft Azure, while Salesforce as a whole will be extending its use of the Microsoft SQL Server database management product.  

It's certainly going to be interesting to see where this partnership goes. 

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