Leading on-demand Customer Relationship Management (CRM) and cloud computing company Salesforce.com (CRM) recently announced that the Salesforce Chatter platform has been successfully integrated by Stratus Technology, considerably enhancing the company’s IT efficiency.
Stratus provides a cutting edge technology to its end customers, which keep their online businesses uninterrupted. The company first adopted the Salesforce CRM applications in 2004, gradually moved on to Sales and Service Cloud 2, and thereafter explored the Force.com platform. Most recently, the company successfully graduated to the Salesforce Chatter technology by using the same platform. Chatter, is the enterprise social collaboration application platform introduced by the company after its Salesforce 2 platform.
Stratus switched from Microsoft SharePoint to Chatter, being dissatisfied with the performance of the former. With Chatter’s social collaboration application, employees of the end customer can now manage projects better, track software license renewal and receive real-time alerts. Moreover, by using Chatter, the system is able to pull together different business events without having to rely on any particular software.
We believe that after the Salesforce 2 platform, Chatter will emerge as an attractive choice for customers, generating additional business volume. Chatter’s success is further evidence of Salesforce’s successful conversion of opportunities in the ever-growing cloud computing continues to gain segment.
As per recent findings of the technology research firm Gartner Inc., the global cloud service market is expected to grow substantially, with revenues reaching $148.8 billion by 2014. The market research firm is of the opinion that the cloud computing market will grow exponentially by 16.6%, generating revenues of $68.3 billion in 2010 and reaching $148.8 billion by 2014 from $58.6 billion in 2009.
Apart from Stratus, CA Inc. (CA) has come out with a new technology, CA Agile Vision, which runs on the Force.com platform provided by the cloud computing major Salesforce.com. CA Agile Vision was designed to provide a competitive edge to users through application development management technology on a cloud computing platform. Cloud computing based companies are increasing teaming up, making competition in this field very stiff.
Salesforce.com reported decent second quarter fiscal 2011 results. It also provided an encouraging guidance for the third quarter and raised the full-year fiscal 2011 expectations on improving fundamentals.
We, however, caution investors about strong competitors in the CRM application and cloud computing areas. The recent downward revision in IT spending forecast may also rationalize near-term growth prospects of the company.
Consequently, the stock currently carries a Zacks #3 Rank, implying a short-term Hold recommendation.
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