Together again? Microsoft and Salesforce deepen cloud partnership despite years of rivalry and rifts

Microsoft’s Satya Nadella and Salesforce’s Marc Benioff. (File Photo)

Microsoft and Salesforce are strengthening their relationship, putting aside a complicated history for a new cloud partnership.

Salesforce will move its Marketing Cloud off its own infrastructure to Microsoft’s Azure cloud. The deal gives Microsoft another boost in its cloud challenge to Amazon Web Services, just a few weeks after it beat out its cross-town rival for a $10 billion contract to build new infrastructure for the U.S. Department of Defense.

Salesforce also pledged to build an integration between its services and Microsoft’s Teams collaboration app.

“In a world where every company is becoming a digital company, we want to enable every customer and partner to build experiences on our leading platforms,” Microsoft CEO Satya Nadella said in a statement. “By bringing together the power of Azure and Microsoft Teams with Salesforce, our aim is to help businesses harness the power of the Microsoft Cloud to better serve customers.”

The companies announced a cloud partnership in May 2014 but competed fiercely against each other for LinkedIn a couple years later. When Microsoft acquired the business social network for $26 billion in 2016, Salesforce CEO Marc Benioff asked regulators to take a hard look at the deal, citing anti-trust concerns.

Soon after Nadella became CEO at Microsoft, Benioff said the two companies talked about partnerships, or even an acquisition. But Benioff said he was turned off during the talks, saying that Microsoft hadn’t changed, despite claims of a new era at the company.

The two allies are also competitors. Microsoft’s Dynamics 365 business competes with Salesforce’s core customer relationship management software. However, under Nadella, Microsoft has shown an appetite to team up with competitors. Earlier this week, Microsoft furthered its partnership with Adobe.

Salesforce works closely with AWS, and it also uses Google Cloud Platform to deliver its services.