Businessweek and ZDNet's Larry Dignan report that Merrill Lynch is the latest mystery customer that is signing up for 25,000 subscriptions. The price for subscription is $500 per user per month. Now, if Merrill Lynch actually were to pay this price, they would be down $150 Million a year. That would be more than 25% of Salesforce.com's annual revenue.
The reality is perhaps the 25,000 subscriptions are at a very heavy discount (90%+), or only a subset of the 25,000 subscriptions are for the "Financial Adviser" edition and the rest are vanilla Salesforce.
On vanilla, here is a question: Is vanilla same as plain? Isn't vanilla a flavor? As in Plain Yogurt vs Vanilla Yogurt? When did Vanilla loose its status as a differentiator?
What do you think? About vanilla? Or Salesforce?
2 comments:
The 25K mark is a big win not just from the revenue perspective (it does contribute big enough, if not significantly big), but also from a perspective of brand equity and marketability. Salesforce now has crossed a chasm of sorts into the large enterprise, replacing in-house enterprise-wide systems, thereby posing a direct threat to the Siebels of the world. Establishing this kind of scalability on a hosted model is not just a boost to Salesforce, it's a validation for the whole SaaS market itself.
I agree that a big win like this certainly helps Salesforce and the move to SaaS in general. And this is true even if the revenue associated with this deal is small. I was simply pointing out that the simplistic reporting elsewhere pointing to the $500 price was devoid of critical analysis. In all, this is a good thing for SaaS.
Post a Comment