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Jeff Bezos wants the bottom half of earners to pay zero income tax—he says nurses making just $75K should save $12K a year

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Indeed chief economist says we’re entering an era of ‘great mismatch’ thanks to a generational imbalance of workers

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Apple’s Steve Wozniak says he cofounded the tech giant after 5 rejections from HP—not to ‘make money.’ For years, his paycheck was just $50
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Microsoft Remains Top Dog in This Software Business Thanks to LinkedIn

Barb Darrow
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Barb Darrow
Barb Darrow
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Barb Darrow
By
Barb Darrow
Barb Darrow
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August 31, 2017, 11:14 AM ET

Microsoft, aided by its $26.2 billion purchase of LinkedIn last year, has fortified its lead as the biggest provider of subscription software, according to numbers released Wednesday by Synergy Research.

Salesforce (CRM), which pioneered the “Software-as-a-Service” (a.k.a. SaaS) market more than 20 years ago, remains the second largest player, Synergy said. Under the SaaS model, businesses use software that streams over the Internet rather than running it independently on their own servers. Microsoft first passed Salesforce on this list last year.

Synergy does not release revenue growth by company, but analyst John Dinsdale did say that Microsoft (MSFT) holds more than 15% of the total enterprise market while Salesforce accounts for more than 10%. Adobe (ADBE), Oracle, and SAP each fall in the 5% to 10% range, he said.

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In aggregate, total sales of this type of software rose 31% year over year to $15 billion.

 

Companies like Salesforce and more recent entries like Workday (WDAY) or SuccessFactors were born to this pay-per-user-per month model while older vendors like Adobe, Microsoft, Oracle, and SAP (SAP) had to adapt quickly as customers embraced the new way of buying (or renting) software. Hence most business customers now talk about Office 365 from Microsoft rather than Microsoft Office. And it’s also why SAP (SAP) bought Concur and SuccessFactors while Oracle bought NetSuite, Taleo, and other companies to gain a stronger foothold in this subscription software market.

Related: Microsoft Stresses Cloud Upside of LinkedIn Deal

The Microsoft-Salesforce dynamic is worth noting because the two software powers have long been frenemies: They compete in sales software but also work together to integrate Microsoft Outlook with Salesforce products, for example.

Microsoft’s successful purchase of LinkedIn last year, however, opened up old wounds. Salesforce had been pursuing LinkedIn but was outbid for it. Salesforce CEO Marc Benioff subsequently complained publicly that the Microsoft-LinkedIn combination hurts competition.

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