Salesforce Inks Strategic Cloud Deal With Amazon

Mitch Wagner
5/26/2016

Salesforce has named Amazon as its "preferred public cloud infrastructure provider" in a four-year deal believed to be worth $400 million.

Salesforce.com Inc. will expand its use of Amazon Web Services Inc. 's cloud for a planned international infrastructure expansion, according to a joint statement by the two companies. Amazon already runs many Salesforce services, including Heroku, Marketing Cloud, Social Studio, SalesforceIQ and the recently announced Salesforce IoT cloud. New services moving to AWS include Sales Cloud, Service Cloud, App Cloud, Community Cloud and Analytics Cloud.

The joint statement doesn't say how much Salesforce is spending.

However, Amazon's most recent 10-Q says it "entered into an agreement [in April] with a third party provider for certain infrastructure services for four years." Salesforce will pay the provider -- unnamed in the 10Q -- $70 million in fiscal 2017, $96 million in 2018, $108 million in 2019 and $126 million in 2020, for an even $400 million. Sources tell Fortune's Barb Darrow that Amazon is the cloud provider.

Salesforce uses Oracle Corp. (Nasdaq: ORCL) databases and can continue to do so, as they run in the Amazon cloud. However, Salesforce is also in the public cloud business, and losing that business to Amazon is a blow to Oracle, Darrow notes.


Want to know more about the cloud? Visit Light Reading Enterprise Cloud.


Salesforce also operates its own data centers, according to a FAQ posted by Salesforce on Wednesday.

All three companies -- Salesforce, Amazon and Oracle -- declined to comment to Light Reading beyond the Salesforce and Amazon public statements.

Salesforce says in the FAQ it will provide details about the AWS arrangement later this year.

— Mitch Wagner, Follow me on TwitterVisit my LinkedIn profile, West Coast Bureau Chief, Light Reading.

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