In a significant win for Microsoft, it has managed to sign a 6 year deal with HP to run the Microsoft Dynamics customer relationship management (CRM) & service software for the former’s employees. The contract is particularly sweet to the Redmond giant, considering that it has managed to steal it from right under the noses of rivals Salesforce and Oracle.
While all the terms of the deal are not clear at the moment, Oracle and Salesforce are probably not feeling particularly happy about it. HP Inc has been a very prestigious partner and until now, depended upon the Salesforce CRM. On the other hand, Oracle had been its service software provider. However, Microsoft has managed to sideline both these competitors and denied them a good bit of business.
HP Inc in case you are unaware of it, is a spin off of the original HP when it divided itself into two different entities. HP Inc meanwhile deals with printers and PCs and is rapidly expanding. The company only today announced that it will be acquiring Samsung’s printer division.
From what we have managed to gather, HP Inc’s 6500 sales people and 20,000 service employees across the planet will soon be using Microsoft’s sales and service software. That is a significant number of consumers and Salesforce, which until now was responsible for fulfilling the CRM related needs of HP Inc employees, can’t be pleased about the prospect of losing them.
Salesforce and Microsoft are fierce competitors, that much is not a secret. However, the ice between these longtime rivals had been thawing somewhat of late. This recent deal between HP Inc and Microsoft though, may just set off another round of rivalry. This wouldn’t be the first time that Microsoft has grabbed something Salesforce had its eyes upon.
When Microsoft acquired LinkedIn, rword was that Salesforce had also been readying to make moves in the same direction. However, the Redmond giant’s $26 Billion offer proved to be too hard to resist and LinkedIn decided to toss its lot in with Microsoft. Interestingly, it was said at the time that the LinkedIn acquisition will go a long way towards boosting Microsoft’s customer relationship management service. Indeed, the company is likely to integrate data from LinkedIn directly into its CRM systems by next year.
Well, who knows? HP may even have taken that information into consideration while deciding to switch its CRM service provider. In all probability though, HP didn’t have much trouble washing its hands off Oracle. The companies have at long been at odds with each other, thanks to lawsuits and other trouble — including CEOs switching over from one to the other. However, they had maintained a business relationship — albeit an uneasy one.
Meanwhile, Microsoft certainly has reasons to celebrate now. The deal gives it a significant advantage in the CRM space and with HP amongst its customers, Microsoft may just find it easier to attract other companies in the niche towards its CRM solutions.