Salesforce’s DimDim Buy – A Typical Proprietary Move

Many have probably seen that has acquired web conferencing tools provider DimDim for $31m. (The rumors of this deal had been percolating since before Dreamforce so for many this was no surprise at all.)

The deal pits in many ways against some big companies and very popular products – Citrix’s GoToMeeting and Cisco’s Webex, in addition to IBM’s Lotus Live set of offerings. With its recent platform buy in Heroku, and this new move, it is funny to see Salesforce continue to add competitive concerns and look to enter in large markets where it has no clout, rather than look to live above the competition in one market where it already does well. Confident move?  Yes. Smart move?  Well, we’ll just have to wait…

And while the DimDim acquisition clearly places SFDC in competition with the likes of WebEx and GoToMeeting, Salesforce would like to look at this differently. Salesforce instead sees this as a pocket acquisition to bolster its Chatter functionality – a tool it is already basically just giving away to gain some stickiness for its actual paid apps. So, if SFDC does not really see much future for DimDim save for part of what is now a free add-on, then the $31m price was not a huge price to pay to make a cool new collaboration feature a little more robust.

But again, if Chatter is basically free at this point, why buy DimDim? The product was open source under the GPL. Couldn’t SFDC simply create an integration to the free tool and offer up that integration along with a simple installer to add video and screen sharing tools to Chatter?

I think the answer here is two-fold. One, I have not yet seen SFDC do anything that resembles open source. Yes, they have opened up their toolkits and platforms for developers, but everyone does that. There is just not that type of culture alive at SFDC in my opinion. This is a company steeped in the grand history of proprietary software.

The second reason (which is definitely intertwined with the first) is that due to SFDC’s multi-tenant model, adding DimDim-like resources without wholly owning the code would be problematic. As we know, in order for SFDC to really have a tight handle on anything its users touch, it has to run on its monolithic platform. This makes upgrades and other things easy, but does set limitations on how SFDC can go to market with technology it doesn’t own.

It will be interesting to see if the nature of a GPL licensed piece of software sitting inside a huge multi-tenant database has any effect on the way in which Chatter users are empowered to make, own and redistribute changes.

All in all, this is chump change for SFDC, and while it plots them theoretically against big names like Webex, I can’t see Salesforce actually making any huge headway into standalone video conferencing with the DimDim technology (After all, Cisco’s Unified Communications suites are pretty awesome and light years ahead of where a DimDim-powered Chatter tool is today). Most likely, will only relegate the functionality as a nice add-on to Chatter.

6 thoughts on “Salesforce’s DimDim Buy – A Typical Proprietary Move

  1. Pingback: Tweets that mention CRM Outsiders » Blog Archive » Salesforce’s DimDim Buy – A Typical Proprietary Move --

  2. Martin,

    There is another yet darker side to this acquisition. Prior to being acquired, DimDim was a popular open source option to WebEx and GoToMeeting. As a long time user myself, you can imagine the disappointment when my update link was met with the note…”Thanks for the dinner and good time, but we have found our sugar-daddy (no relation to Sugar) and we are out of here”. Forget that thousands of loyal users help create the DimDim buzz. We were now considered loiterers and no longer welcome.

    So does this make SFDC the “anti” open source company. Time will tell. But they are certainly off to a good start.

  3. Barret,

    Great points – It is not only clear in my mind that is not in any way an open company, but they simply do not understand what made a product like DimDim or other open projects/products interesting. The buzzing community is what makes these projects great – in my opinion more important than the code or how much money is being made.

    Salesforce has made two recent acquisitions in the open space – and it looks like they have ruined them already. By overpaying and closing up Heroku to the hobbyists that loved it – SFDC has basically attempted to make a cool little developer tool into an enterprise Ruby platform – that initiative will fail as Engine Yard already owns the Ruby platform space.

    Couple that goof with paying $31m to hide cool conferencing and collaboration tools inside a fake social tool nobody wants – and SFDC has just paid nearly a quarter of a billion dollars for open source projects that a) it probably could have incorporated for free if it didn’t have such an out-dated infrastructure and b) will not see positive returns upon in any monetary way as these will either gain no traction or be included as free dev tools.

    What a weird turn of events…

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