Salesforce.com 2011 Annual Report Download - page 10

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We designed and developed our applications to be easy-to-use and intuitive solutions that can be deployed
rapidly, customized easily and integrated with other software applications. We deliver our service through any of
the market-leading Web browsers. Customers who use our CRM and collaboration services and platform are able
to avoid much of the expense and complexity of traditional enterprise software development and
implementations. As a result, our customers incur less risk and lower upfront costs and benefit from increased
productivity.
We market our service to businesses on a subscription basis, primarily through our direct sales efforts and
indirectly through partners. Through our Force.com platform and developer tools and our AppExchange, we also
encourage third parties to develop additional functionality and applications that run on our platform, but which
are sold separately from, or in conjunction with, our CRM service.
Cloud Computing
Cloud computing fundamentally changes the way enterprise business software applications are developed
and deployed. Application developers no longer need to create and manage their own infrastructure of servers,
storage, network devices, operating system software and development tools in order to create a business
application. Instead, the entire infrastructure is managed by third parties who specialize in infrastructure
management, and developers simply use an Internet browser to access the development environment. Application
users can gain access to a variety of business applications via an Internet browser or mobile device, and are able
to take advantage of a robust, secure, scalable and highly available application, without the cost and complexity
of managing the hardware or software infrastructure.
Our vision of enterprise cloud computing is based on a multi-tenant technology architecture and a
subscription service business model. With multi-tenancy, multiple customers share application, platform and
infrastructure services provided by the vendor.
Today, we believe that the next phase of cloud computing is transforming enterprise software again. Driven
by the consumerization of information technology (“IT”), our next phase of cloud computing will have three key
characteristics – it will be social, mobile and open. With the popularity of social networking websites, new ways
to communicate and collaborate based on feeds and status updates have emerged. In the enterprise market, that
means enabling employees to easily find, share and collaborate on information. In addition, with the wide
adoption of mobile phones and tablets, our customers now expect cloud computing technologies to be built for
business to work on these devices, regardless of the carrier or operating system. We are working to provide these
new kinds of cloud computing technologies to enterprise customers around the world.
Cloud Applications
Cloud applications enable businesses to subscribe to a wide variety of application services that are
developed specifically for, and delivered over, the Internet on an as-needed basis with few or no implementation
services required and without the need to install and manage third-party software or hardware in-house.
Historically, only large businesses could afford to make investments in enterprise resource planning, CRM
and collaboration applications to gain an enterprise-wide view of business information and automate and improve
basic processes. However, cloud applications are available to businesses of all sizes and across all industries.
Multi-tenant architectures enables cloud vendors like us to leverage a common infrastructure and software code
base across all of our customers who benefit from access to the most current release of the application, periodic
upgrades, more rapid innovation and the economies of a shared infrastructure.
We believe the shift to cloud applications provides significant benefits even beyond those associated with
multi-tenant infrastructure. Businesses are able to realize many of the benefits offered by traditional enterprise
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