News Analysis: Salesforce.com Buys Heroku For $212M – Shows Commitment To Next Gen Apps

Published on December 8, 2010 by R "Ray" Wang

Acquisition of Heroku In Line With Platform Future of Salesforce.com

At Marc Benioff’s keynote, the CEO reiterated his commitment to 6 clouds: Sales, Service, Data (Jigsaw), Collaboration (Chatter), Cloud Platform (Force.com), and Database (database.com).  As Salesforce.com continues to diversify its portfolio into adjacent markets, the platform as a service (PaaS) component remains a key area of emphasis.  Without a strong developer ecosystem, the Cloud pioneer would relegate itself to a one-trick pony.  Consequently, the recent VMforce announcement targeted the Java community.  Now Salesforce.com seeks to win the hearts and minds of the Ruby ecosystem.  This platform as a service (PaaS) acquisition is significant because Heroku:

  • Delivers the full Ruby platform. As a multi-tenant platform and hosting environment, Heroku keeps it simple and hides the complexity of servers, infrastructure, slices and clusters from users.  Application code dynamically scales using a technology called the Dyno Grid.  Using compiled slugs, a self-contained and read only version of code, Heroku addresses scalability and high availability for developers in a contained and self-managed system..

    Point of View (POV):
    Next generation apps developers seek the simplicity of not having to manage servers and installs.  PaaS options accelerate time to market for new solution.  Cloud2 will require ultra fast elasticity and Heroku has proven this model out.
  • Serves the hot mobile and social apps market. With over 105,000 mobile and social cloud applications built on Heroku, Salesforce.com intends to provide the leading platform for next gen apps development.   Heroku delivers the backbone behind many of the new consumer tech innovations.

    POV:
    Future apps development and developers align more with the consumer tech world. Salesforce.com’s acquisition thrusts the cloud vendor into a new world of mobile and social apps.  If successful, Salesforce.com will attract the next generation of developers.
  • Aligns with the database.com acquisition. Heroku’s pricing model is based on dynos, a single web process running code and responding to http requests.  The more dynos used the more concurrency achieved.  As users consume code, they increase database usage through a portfolio of options (see Figure 1.).

    POV:
    database.com can fit neatly into the PaaS stack for Heroku users.  The pricing model could prove complimentary for database.com and other Salesforce.com users.

Figure 1. Heroku Offers A Wide Range Of Database Options

Source: Heroku

The Bottom Line: Salesforce.com Intent On Paving Its Future
Already in the Cloud, Salesforce.com sees its future aligned with mobile and social.  This move provides the significant infrastructure to win the hearts and minds of the next gen apps developer.  Unlike many of its enterprise software competitors, Salesforce.com realizes that the platform is key to its future and success.  If successful, this move will also help Salesforce.com extend its reach into the consumer tech side of applications.  While there are many benefits of PaaS, customers moving to Heroku should seek provisions in The Customer Bill of Rights: SaaS.

Your POV.

Do you think Salesforce.com can transform into a full PaaS?  Have the failures in APEX taught Salesforce.com the lessons learned for success in this new platform?  Please post or send on to rwang0 at gmail dot com or r at softwareinsider dot org and we’ll keep your anonymity.

Related Resources And Links
20101207 PR Newswire – Salesforce.com Signs Definitive Agreement To Buy Heroku

20100429 SoftwareInsider – R “Ray” Wang “News Analysis: Salesforce.com and VMware Up The Ante In The Cloud Wars With VMforce”

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Copyright © 2010 R Wang and Insider Associates, LLC. All rights reserved.

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