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Salesforce, H-P Collaborate

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The world’s leading CRM platform provider Salesforce.com, Inc. (CRM) recently announced a strategic alliance with Hewlett-Packard Co. (HPQ) or H-P to offer CRM services on HP’s Converged Infrastructure. This new offering namely Salesforce Superpod  is intended for companies that have an extensive IT infrastructure, which requires a certain level of compliance and enterprise integration.

The partnership ensures tighter integration between H-P and Salesforce clouds, which will help customers to easily move their data between the two platforms. Considering these growth in cloud-based services, the partnership could facilitate market share gains. Additionally, the integration of HP’s hardware technology and Salesforce cloud services will enable users to connect and share information securely. Moreover this cloud-partnership will help Salesforce to build and deliver cloud solutions that in turn will drive growth.

The Superpod converged infrastructure is an all in one box combining computing, storage and networking demands of IT enterprises by offering reliable and timely services.

Earlier this year, Salesforce inked a deal with Oracle Corp. This nine-year Oracle-Salesforce deal covers every aspect of cloud computing. Under the terms of the deal, Salesforce software will run on Oracle’s Linux (previously Salesforce used Red Hat Linux) and its cloud based applications will support Exadata hardware.

Salesforce reported revenues of $1.08 billion in the third quarter of 2013, up 36.5% on a year-over-year basis. During the reported quarter, the company witnessed continued demand across all of its cloud solutions, supported by a decline in the attrition rate.

The higher number of deal wins were encouraging and so were the geographical contributions. Overall, the company’s diverse cloud offerings and a stronger spending projection by Gartner are positive.

Although, the company is growing reasonably in the cloud market, growth prospects have been tempered to a considerable extent by the renewed efforts of other tech giants such as Dell Inc. and International Business Machines.

Competition from Oracle Corporation (ORCL) and SAP AG (SAP), continued weakness in Europe, currency headwinds and an increase in investments could pose near-term challenges.

Currently Salesforce has a Zacks Rank #3 (Hold).

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