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July 25, 2019

Salesforce Turns to Alibaba for Chinese Foothold

Salesforce will become the exclusive enterprise CRM product suite sold by Alibaba.

By CBR Staff Writer

Salesforce will run its customer relationship management (CRM) in China on Alibaba Cloud instances, under a strategic partnership agreed this week.

Under the terms of the deal, Alibaba will become the exclusive provider of Salesforce to customers in mainland China, Hong Kong, Macau, and Taiwan; Salesforce will become the exclusive enterprise CRM product suite sold by Alibaba.

The companies offered scant further details on the agreement.

Cloud/data centre issues have been flashpoints at the heart of the US-China trade dispute, with a report by the US Trade Representative in March emphasing that US cloud providers are being forced to sell data centre assets to local Chinese partners to continue operating in China.

Alibaba has pitched itself firmly as a way for multinational software companies to gain access to the Chinese market.

Gartner described the move as “another example of international cloud vendors finding solutions to offer privacy-compliant software services to serve their customers in China” amid shifting and often unclear Chinese data privacy requirements.

See also: Alibaba Cloud: Chinese Whale, European Minnow – but for How Long?

Gartner research director Oliver Huang said: “For multinational organizations who have Salesforce users in China, what remains important is to understand the status of privacy-compliance of the solution, the migration support from Salesforce and the available resources in China from Salesforce partner ecosystems to support the migration.

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“Similar as GDPR, for an end user organization, vendor solution  compliance doesn’t mean the job is done, it is only one of the boxes ticked.”

He added: “The strategic partnership between the largest CRM vendor in the world and the largest digital commerce ecosystem and IaaS player in China surely leaves space for additional imagination. The synergy that these two providers can create may at the same time introduce a competitive environment amongst themselves. This will be a delicate matter between the parties.”

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