Good afternoon. My name is David, and I will be your conference operator today. At this time, I would like to welcome everyone to the Salesforce.com Q4 and Full Year Fiscal 2012 Results Conference Call. [Operator Instructions] I would now like to turn the call over to Mr. David Havlek, Head of Investor Relations. Sir, you may begin your conference.

Thanks, David, and welcome, everyone, to today's call. Earlier this afternoon, Salesforce.com issued a press release detailing its fourth quarter fiscal year 2012 results. In addition to the press release, the company results can also be found in the Form 8-K filed with the SEC. Joining me today to discuss our outstanding fourth quarter are Marc Benioff, Chairman and CEO; and Graham Smith, our CFO. [Operator Instructions] Our commentary will primarily be in non-GAAP terms today. Reconciliations between GAAP and non-GAAP metrics for both our reported results and our forward guidance can be found in our earnings press release. At times in our prepared comments or responses to your questions, we may offer incremental metrics to provide greater insight into the dynamics of our business or our quarterly results. Please be advised that this additional detail maybe one-time in nature, and we may or may not provide an update in the future. With that, let me make this call official with a brief safe harbor. The primary purpose of today's call is to provide you with information regarding our fiscal fourth quarter 2012 performance. Some of our discussion or responses to your questions may contain forward-looking statements. These statements are subject to risks, uncertainties and assumptions. Should any of these risks or uncertainties materialize or should our assumptions prove to be incorrect, actual company results could differ materially from these forward-looking statements. All of these risks, uncertainties and assumptions as well as other information on potential factors that could affect our financial results are included in our reports filed with the SEC, including our most recent report on Form 10-Q, particularly under the heading Risk Factors. To access our Q4 press release, including the GAAP to non-GAAP reconciliations, our historical results, any of our SEC filings, the webcast replay of today's call or simply to learn more about Salesforce, I encourage you to visit our Investor Relations website. Finally, before I turn the call over to Mark, please be advised that during today's discussion, we may reference certain unreleased services or features not yet currently available, because we can't guarantee the future timing or availability of these services or features to recommend customers make their purchase decisions based on services and features that are currently available. With that, let me turn the call over to Marc.

Thanks, David. Our fourth quarter was a really gorgeous finish to an amazing year of growth for Salesforce.com, and the first quarter is already off to a spectacular start. I'm going to get to that in just one moment. Revenue for the fourth quarter rose 38% from a year ago to $632 million. For the full year, we delivered approximately $2.27 billion in revenue, with an annual revenue run rate that now exceeds $2.5 billion, and our full year revenue grew 37% from fiscal year '11. Look, David, no other enterprise software company of our size is growing faster. Deferred revenue increased by 48% year-over-year, propelling deferred revenue past the $1 billion milestone for the first time ever, and we now have more than $3.5 billion of booked business on and off the balance sheet. We also set a company record for cash flow in the quarter exceeding $200 million operating cash, that's an increase of 45% year-over-year. For the full year, operating cash flow rose 29% to nearly $600 million. And finally, we added approximately 2,500 employees around the world in fiscal year '12, including nearly 2,000 of them right here in the United States of America. Now during the quarter, we closed more than 4x the number of 7 bigger transactions than Q4 of last year, including the largest transaction in our history, which was quickly usurped by another transaction that I'll soon mention. In all, we signed more than 100 7-figure transactions and 9 8-figure transactions in the quarter. And as I've been foreshadowing, I'm thrilled to announce that since closing the fourth quarter, we've already topped ourselves by signing our first ever 9-figure transaction in the opening days of Q1. Now, I want to be really clear with everyone before I continue. This 9-figure transaction is…

Thanks, Marc. We capped off a great fiscal 2012 with an outstanding fourth quarter. The strong new business pipeline, we discussed in Q3, enabled us to deliver results that exceeded our expectations in Q4, including revenue, cash flow and EPS. Let me cover a few highlights starting with revenue. Q4 revenue increased to $632 million, up 38% over Q4 last year. Fourth quarter revenue benefited from a small FX tailwind of just $2 million. In addition to the strong new business Marc discussed, we continue to benefit from a sustained decline in dollar attrition, which fell for the 10th consecutive quarter, to end the year still in the mid-teens percentage range. For the full fiscal year, revenue increased to $2.27 billion, that's up 37% over last year. Excluding an FX benefit of approximately $37 million. Full year revenue, on a constant currency basis, grew 35% over last year. Each of our regions posted solid fourth quarter revenue growth. Revenue in the Americas grew 41% to $436 million. In Europe, revenue was $108 million, that's up 30% in dollars and 32% in constant currency, helped by strong renewals, and in Asia, revenue was $88 million, that's an increase of 34% in dollars and 28% in constant currency. Japan continues to improve when compared with the first half of the year. Overall, we were pleased with the balance of regional revenue growth in the fourth quarter and the full year, particularly, let me take into account that the Americas growth rate gets an additional benefit from recent acquisitions. On the subject of acquisitions, let me take a moment to briefly discuss the impact of our acquired businesses. Over the past 2 years, we've made 11 acquisitions with Jigsaw, Heroku and Radian6 being the most significant from a financial point of view. Excluding…

[Operator Instructions] Your first question comes from the line of Brent Thill of UBS.

Marc, just on the large deal front, obviously, you saw an incredible pickup. Can you just help us understand now that you're passing to the 9-figure mark, what you're starting to see in the pipeline. I had one quick follow-up for Graham.

Well honestly, we've just never seen a pipeline like this. And we talked about this all through the year. It's been building through the year, every quarter this year has been a great quarter. You know I feel that way. We had a great first quarter, we had a great second quarter, we had a great third quarter, and that completely built the pipeline up for the fourth quarter, and we did not clean the pipeline out in the fourth quarter by any means. There is plenty of -- plenty more in the fourth quarter to the evidence of that. Already in the first quarter, we've closed our first 9-digit transaction ever, which was with a large Illinois-based insurance company. And I -- this social enterprise strategy, Brent, the thing about this is, is that we are now coming into companies and our message is we want to listen to you, and we want to understand what -- where you're trying to go strategically, because as the world is moving to social, as the world is moving to mobile, as the world is moving to cloud, our customers are saying how do they build their employee social networks, their customer social networks and their product social networks, and we are becoming a trusted advisor. And through our thousands of salespeople all over the world, we want to have that trusted interactive relationship with them, where we could sit down. And in that process, the deals are getting bigger because we're not just selling an FFA solution anymore and we're not just in the service solution anymore or just a platform decision or just a social monitoring decision or just a collaboration. We put it all together because as you know, because you followed us a long time, this is one integrated service. This is not a bunch of acquired software stacks like other vendors roll in with, that all look different and act different and architected different. This is one platform. And that gives customers the ability to do some pretty exciting, and as you can see from this quarter, large-scale implementations with us. And when you look at a great company like Hewlett-Packard, I mean, when Meg Whitman announced that she had gone to Salesforce.com at her sales kicked off, she got a standing ovation. They could not wait to get off the Seibel. And that's how it is, when we roll in to these prospects and these customers, they applaud us as we're coming in to take out these old software products that aren't mobile, aren't social and are not cloud. That's what's happening.

The next question comes from the line of Jason Maynard of Wells Fargo.

Marc, can you maybe talk a little bit more about social in terms of where you're seeing the initial uptake? Is it collaboration for internal workers? Are you starting to see some traction beyond Radian6 for external customer engagement? What's the path, if you will, that companies are taking on the social enterprise journey? And how is it driving then, if you will, standardization around you as the front office system of record?

Well, what I can tell you is really, it aligns with what I have been saying now for about 2 years, which is, it starts with Chatter. I mean, the phenomenon that has happened in the world is the creation of this unbelievable company called Facebook. And behind it, Twitter. And you've got 1 billion users who have conditioned themselves on their iPhones and on their iPads and on their BlackBerrys and on their Android phones that they're on these social networks all day long, and then they roll in to their SAP system or their Oracle system or their Microsoft system, and they're like, "What is this?" They want to rebuild and re-architect their enterprises through this same metaphor. They wanted Facebook for the enterprise, they wanted Twitter for the enterprise, and that's what we're working on delivering. And it started with Chatter. But Chatter is not some tack-on or add-on to Salesforce. As you know, we rebuilt our architecture and it was difficult and it was painful for us, but we rebuilt Salesforce and deep within all of our system and our APIs and deep inside our databases, we added status updates and feeds, and we added profiles and we added real-time capabilities, and we added all the things that you need to basically create social networks. And then we're able to apply it, as I said before, to the employee social network or the customer social network or the product social network, and it's evolving into these incredible systems and applications. And it's not one system with all your data that runs outside the firewall and one data with all your system running inside the firewall. It is a perfect symbiotic system that the customer data and the employee data is all in one database, and it provides an incredible application. But I could tell you that when we roll in to do these demonstrations, that it's highly differentiated against our competitors who are still mostly pitching this stuff that was built a decade ago. And they haven't -- they still don't get it. And I think customers want change, and they're demanding change and Salesforce.com is the change that they can believe in.

The next question comes from the line of Heather Bellini of Goldman Sachs.

Marc, I was wondering if you could talk a little bit about Heroku and what's driving the ramp in that business, kind of what are you seeing from people, given some of the growth that you talked about in your prepared remarks. And also, I just wanted to know, if you had to look out for this year or even the next 2 years, and you look at the Service Cloud business, is that kind of the next big pillar of growth that can surprise to the upside given all those old call center deployments that were out there from the last decade?

Well let's start there first. It is an awesome product. There's no doubt that Service Cloud has a huge amount of momentum to become our next multibillion-dollar product line at Salesforce. We all feel that way. It had another unbelievable year that were -- more than doubled this year. And we've done a great job with Service Cloud. And not just enterprise Service Cloud but now we have our new SMB Service Cloud called Desk.com, and I don't know if you've seen Desk.com but that's another huge area that we're just starting, which is based on the acquisition we made with Assistly. We were able to take Desk.com and say, "Okay, now we can bring Service Cloud down for the rest of us." So, yes, I agree that Service Cloud is a great level of momentum, but I have to tell you, we have a lot of different product lines that are on fire, and it's kind of hard for one of them to beat out another because the sales product is still doing great, service is doing great, collaboration is doing great, marketing in Radian6 and the work that we're doing there with Marcel and his team, they're doing unbelievable, and the platform is doing unbelievable. So that's where it's hard to say, "Oh well, the next one is going to be this." When the reality is the next one is all of them working together and the next big one, if you want me to pick one, is social enterprise. The social enterprise and the social enterprise license agreement, which is what we introduced at Dreamforce, that is the big one. And that's what customers really want. They want to come in and say, "Give us the social enterprise." And yes, service, Heather, is a key part of…

Your next question is from the line of Mark Murphy of Piper Jaffray.

I wanted to ask you a question on the Radian6 social monitoring product. How is it changing the game when you can walk through the door and meet with a prospect and demonstrate that you know more about certain aspects of their business than they do? I can't imagine there's really any other company in the world that can do that. And if you can open a company's eyes to what is being said about them on the social web, is that in turn accelerating adoption of all your other products so that the customer can engage and respond?

Well, when I look at Radian6, I mean, the power of Radian6. This is big data social analytics. We're building this massive data warehouse of all these real-time social interactions, this huge service, and customers can come in and plug into that and say, "Okay, what's going on with my brand, my company, my executives, my competitors, my employees and you get this incredible analysis." But if you were in our New York event, you saw us roll out something new which is the really, truly awesome thing which is still coming is Social Hub, which is we have this incredible CEO, leader of Radian6, Marcel LeBrun, who has designed this social hub, where you basically put in all of these various triggers and queries and reports, and you can move and say, everyone who is unhappy with my product, okay? Or who's complaining about this price increase or who has this issue with this brand, who's on these social networks move them and create cases into the Service Cloud, which is this perfect integration between CRM and Radian6. When you get these 2 things working together, that reinforces the social enterprise story. And that's where, again, we differentiate against the competition. It's not that we're coming in and say we're the only ones with social monitoring. It's we're the only ones who have the social enterprise story and can make it real, and it's not coming in, as I said, with a bunch of siloed legacy client server stacks. We're coming in with this integrated service, and that integrated service is a key component, as you're mentioning, in social monitoring but the key is the social monitoring is part of the total story. And you're going to see more of that. I'll give you a great example. You could be -- put your employee database into Radian6, and you could be monitoring, here's all my former employees, here's all my current employees. I don't think it's that far away, where all of a sudden, you're doing social monitoring and you'll see that your former employee, who is maybe at one of your competitors, is talking on Facebook or talking on Twitter to one of your current employees about a job in this company. And I think it's not a huge leap that you could see a phone call coming from corporate retention saying, "Hey, it's corporate retention. We just want to find out how you're doing and are you happy here at this company?" Radian6 gives you that kind of social intelligence and gives you a level of performance and capability that you're just not going to have in any other way.

The next question comes from the line of Adam Holt of Morgan Stanley.

My question, I guess, Marc, is to you. You've been pretty steadfast in your commitment to investing in the growth opportunities in front of you, and obviously, that's bearing out with terrific numbers this quarter. You did, however, guide to margins going up next year for the first time in several years. Can you give us your latest thoughts in terms of how you're thinking about the balance between growth and margin expansion?

I'm very committed to increasing our margins. I mean, I'm trying to push as much as I absolutely can do it. And I feel it's very important for the future of our business that we continue to expand our margins. And what I do is I just play that against -- I just delivered a 37% growth year and a 38% growth quarter, and I've done that because we are spending. And if we brought margins way, way, way up and slowed spending then, are we going to be satisfied like with a lot of other cloud companies at 25% growth or 26% growth. I think it's a mistake to be delivering 25% or 26% or 27% growth today because this is the heyday of the cloud. This is the Renaissance. We are in the great time. This is the time to create all this amazing new technology. We've all changed the devices we've used. We're all changing how we use computers. There needs to be an enterprise company that's going to come in and deliver this at scale with the number of salespeople and the service organization, the products and that's why we've spent. But at the same time, I'm committed to raising margins because I think it's important for the company. I'm also committed to delivering very strong cash performance. As you can see, the cash performance for the year is awesome and for the quarter. So we're trying to do it all, and doing it all is a hard, okay? But we're doing it, I think, as well as anyone and we have been doing it. You know how I feel. I feel even like, last quarter we were doing it. And I feel that this quarter we're doing -- I feel we've had consistent execution all year, and I feel the end of this year was just a solid ending, and then we have the spectacular beginning to the new year with this 9-digit transaction, we're going, whoa, let's open a door even for our own employees, going, yes, the social enterprise strategy, we can see how this can become seminal in these companies.

The next question is from the line of Brad Zelnick of Macquarie.

Marc, the large deal of your metrics are unbelievable. Obviously, a 9-figure deal doesn't happen overnight, and it refutes all of the bears in thinking that Salesforce is really only a mid-market company and really can't penetrate the large enterprise. With that said, clearly, something has changed. Something's changed in the willingness for large enterprises to make enterprise-wide, not just department-level commitments, to Salesforce as a platform. But can you maybe speak -- what is the pipeline of those large deals look like? How do you think about the mix of your business looking 1, 2 years out in terms of large enterprise, mid-market and SMB?

Here's the beautiful thing about this business. These big deals don't matter to us. We don't really care about the big deals. It's just icing on the cake. And if you've been following our business for a while, that's not the business we've built. We're all about -- basically, we're all about transactions and we're all about throughput, and we serve a wide portfolio of customers, small, medium and large. These big deals which we roll out, we have 8-figure transactions, 9-figure transactions, it's immaterial, it is. The most important thing is that we have a broad book of business, and that we're not dependent on any one transaction or any one customer as part of who we are as a company. I don't think any -- I don't think even our largest customer even represents 1% of our revenue. That's very unusual. And I think that the power of the company is that it is a balanced portfolio of business, small, medium and large; it's a balanced geography of business and we've talked about Asia, the U.S. and Europe; and it's a balanced product line. It's kind of to Heather's point. It's sales, service, it's collaboration, it's platform, it's marketing. So that's what I've been focusing on as CEO for a number of years is to make sure that our customers, okay? And our company, basically, give this kind of level of equanimity. We're not all about the enterprise and the high end, we're not all about the small business and the low end. We're about including everyone. We want to get everyone in the social enterprise boat. That's really our goal.

And just one quick follow-up to a point that you've made. Salesforce up until now has a very focused geographic approach only operating, if I'm not mistaken, or really selling into 10 or 12 countries. So there are obviously many more markets globally that you can go after. What is this year's plan have in store in terms of international?

This year's plan really looks a lot like last year's plan. I mean, let me tell you -- I mean, I address this issue all the time with our own employees. The software market in the world, it's not the same as selling PCs or servers for example. Technology industry is very, very different by sector. And one thing that I can tell you is -- I'll give you an example. You probably saw Steve Ballmer did this huge rant in Beijing about 3 or 6 months ago where he was saying, "Our Chinese revenues are less than our revenues in the Netherlands," I think it was. And he said, "But I have spent billions in China, and I have got tens of thousands of Chinese employees, and my revenue -- I just can't get my revenues going." And the reason why that is, is because, really, the most important software markets of the world, the top 7 or 8 markets, no more than 10 markets really represent 85% to 90% of the total market. And you need to be focused when you're in a new category like cloud because the U.S. is obviously tipped to cloud. But Europe has not quite tipped. I would say Japan is getting there. The U.S. and the U.K. and Japan, these are the 3 biggest software markets in the world. You've got to dominate these markets if you're in software. Then you can move on to other markets like, for example, France and Germany, Australia, Canada. But a lot of these smaller markets, that has not been a focus for us. And I think -- I get questions all the time from our Board, whatever, well, what are you doing about this emerging country or that emerging country? We really look at an emerging country like Minneapolis. To us, that's an emerging country because the Minneapolis software market is bigger than Brazil. And we're asking ourselves, What are we doing in Minneapolis? That's why I just was in Minneapolis. That's why I just did a seminar in Minneapolis. That's why I'm working so closely with the customers in Minneapolis because that is actually a major software market: Detroit, Atlanta, Washington D.C. and we still don't have enough coverage. You look at a great customer of ours, General Electric, it's an incredible company, and we have great relationships with GE Health and GE Energy and GE Capital and NBC Universal and on and on and on. But the thing about GE, GE as a company is bigger than the software market of Brazil or India. So you better be focused on selling to General Electric. And that's where we are today. We're still working on doubling down on the core of the software industry. And until we're really done with that, we won't be ready to move into kind of the more discrete smaller markets. I hope that explains the international strategy.

Your next question comes from the line of Kash Rangan of Merrill Lynch.

Marc, for you, when I look at the broader CRM market, it's $17 billion, $18 billion market. The SaaS portion it is about 1/4. And although you guys continue to put a very, very impressive results, there's nevertheless some doubt in some corner of the market that CRMs are tapped out and that sales automation is only as good as it gets with these kinds of numbers. Can you help us understand, given that SaaS is only 1/4 of your core CRM market, what does it take for you to start gaining share in the broader CRM market, granted that you have been doing so, but when I look at the rest of the market, it's much, much bigger than SaaS. So when does that on-premise market really become cloud, if it does, obviously, you're maybe poised for a pretty significant growth. And so that's one thing I'd love to get your thoughts on. And also platform, if you look at your days at Oracle, databases became the standard that other ISPs and application started writing too. So could there be a platform type effect for your Force product? And are you seeing traction for Force outside of your core sales and marketing areas?

Well, I think that number one, to your point, cloud is a very small emerging part of the total software industry. And multi-tenant shared systems like the ones that offer, that Salesforce.com offers, is still one of the smallest, most discrete parts of the software industry. We are by no means mainstream, right? I mean, you still see the huge intellectual debates out on the Internet about multi-tenancy and shared systems. eBay and Amazon or Google are decades old, and still people are arguing about the future of software. So that has to be upside for us. It has to be that the vast majority of companies still are not using this model. But they're going to be. And as devices change and as new features and capabilities are required by customers, it's going to come through this model. So we're still at the very, very beginning. We are in the first innings of cloud computing. This is still the Renaissance. This is -- we're just see -- I had this great dinner last night with a dozen CEOs of young companies, and all these guys are in their 20s and 30s, and they're amazing, and these companies are just incredible, and of course, all these companies are social, mobile and cloud. No one is starting a new software company today. It's not like you go to dinner here with someone in San Francisco, "Gee, yes, I'm building my SQL Server application. I'm building my .NET application. Oh, I'm so excited I just bought an Oracle database." That is not what people are saying. What people say is, "I'm building this great new shared service. It's great." Everybody has got multi-tenant, everybody's mobile first, everybody's cloud first, everybody is social first. And it's yielding these incredible new companies. And I…

Your next question is from Ed Maguire of CLSA. Edward Maguire - Credit Agricole Securities (USA) Inc., Research Division: There's been quite a lot of activity on M&A around some of your competitors. And I was just wondering how this has changed the conversations you have with your customers.

Well, I don't really get what the competitors are doing, honestly. Well, I kind of do. There's 2 people I don't really understand. I don't really understand why these CEOs of these relatively little companies are selling out at these high growth rates to -- like I don't understand the SuccessFactors SAP deal. At some level, I understand that SAP's HR product kind of sucks and they have no market share and they're losing deals to Workday and so they need to shore up and they don't know what to do, so they need to buy Lars' company. But why does Lars want to sell his company to SAP? Did he not see what happened with Shai Agasi? Did he not see what happened with John Chen? He's going to be controlled by this German Union. I didn't get it. I don't understand why you would sell your company. He had a great company and now it's gone. And it's into this German borg kind of thing. It's like gone. And Taleo, I kind of understand because it's kind of a piece of junk, and they were trying to sell it for a couple of years. But okay, Oracle felt like they had to respond but then what is Oracle's message around Fusion? Didn't they already have HR? Like when Oracle buys right now, like didn't they already have CRM? What is the message now? Which app am I supposed to buy from Oracle? Do I buy Oracle Fusion HR? Do I buy Taleo? Do I -- When we've seen this thing and I think that it's mostly a, A, reaction to these larger software companies with Oracle and SAP, their organic license growth rates are pretty pathetic. And our organic license growth rate before our acquisitions for this quarter were over 30%. Oracle and SAP's license growth rates are single digits. It's not pretty and that's why I think they have to buy these things. It's certainly not giving them a cloud platform, you know that. Taleo and SuccessFactors and RightNow. They're not cloud platforms. They're not giving them a strategy going forward. I view this as very tactical acquisitions and in many cases grabbing -- grasping for straws. I don't see how it's going to turn into something more than that, and I think for these entrepreneurs who sold their company at a $200 million, $300 million revenue level, I think they mostly, especially Lars, made a mistake.

Your next question is from Tom Ernst of Deutsche Bank.

Calling here from the emerging market Minneapolis today. So Marc, just to follow-up on that question. Do you change anything strategically because we're seeing M&A start to pick up in the SaaS industry? And maybe specific with the competition, because I think the change, directionally, for SAP is the most aggressive. Does this change the way perhaps you might compete or cooperate with them in the market, do you think, looking forward?

Well, I think that at the end of the day, we actually have very good relationships with Oracle and SAP. You have to, in our industry, be able to partner and compete at the same time. And in our industry, you can't take these things personally, you can't get angry about these things because customers demand that you work together. We look at our big SAP customers. Many of the ones that I mentioned and others -- we're probably in, now, every major SAP customer in the world. And as we look at these big SAP customers, whether we're in there in a big way or a little way or an emerging way, they want us to be able to work with SAP. So I mean, I have a very good working relationship with Bill McDermott. My job is to make my customers successful. So on one side, I'm happy like give you my direct and unedited feedback on how I view their strategy and how screwed up I think that they are in cloud computing. On the other side, when the call ends, I have to go make sure that Coke is successful and Burberry is successful and Sony is successful, and that requires me to work with them very closely. And we get that. And of course, when they say something crazy about the cloud, I don't get upset about it or... it's like rhetoric, so I move back into, okay, how are we going to make these customers successful? Because at the end of the day, these customers are becoming social enterprises. We are becoming their front office, and SAP is kind of their legacy back office, and we need to hook those 2 things together. That's a critical thing for us to be able to do. So we can roll in with the sales and service and collaboration and marketing. We've got to be ready to hook that into SAP's general ledger, payables and receivables, and we've demonstrated that ability continuously and we'll continue to focus on that.

The next question will come from Laura Lederman of William Blair. Laura Lederman - William Blair & Company L.L.C., Research Division: Can you talk a little bit about how customers are accepting Database.com and also the acquisition of Rypple. And maybe on the subject of Rypple, give us a sense of sort of your broader high-level thinking on your kind of HR strategy in general?

Well, Database.com has been a fantastic strategy, and all you have to do is go to the Database.com website to see the huge customer success, the amount of transactions that are being executed, the number of databases that are getting spun up. With Rypple, we are at the beginning of a very exciting story with HR. I was just on Rypple actually about an hour ago. And with Rypple, you have the ability to go in and to basically start working with your people in a whole new way. And it's all about performance management, it's about being able to do reviews, it's about being able to do -- get feedback, it's about being able to do praise and that will all evolve into native HRMS and other key features. We will also have some great relationships with some terrific HRMS vendors like Workday where we'll tightly integrate Rypple in with their systems and with other providers and you're going to find a perfect balance between what our ISVs are doing and what technologies are available from Rypple. You also probably know we hired incredible executive, John Wookey, who was at SAP for several years, building kind of their next-generation technology and before that was 15 years at Oracle building the e-business suite, and he's leading this HRMS effort, and you'll be seeing on our March 15 date, and I hope you'll be there, Laura, here at Cloudforce in San Francisco, where we're going to have 15,000 people and we're going to be showing that some of that integration for the very first time. And why that's so important is because it is the social enterprise. We want to be able to show our customers that social profile, the employee social profile, the customer social profile. We want to show…

And your next question comes from Rick Sherlund of Nomura.

Just to follow-up on Laura's question, Marc, to further leverage the momentum of social enterprise outside of the front office, just how aggressive should we think that you would be over the next couple of years in expanding perhaps more broadly into talent management or other segments of the market? And I just wanted to hear from Graham, I was kind of curious on what the -- if you could quantify the impact of this change in the billing terms to annual invoicing? What's the impact on the deferred from that? Is it a big number, a small number?

I would like to go first, Rick. The total impact during the quarter of the change to annual bill frequency, I mean, it depends how you -- what you view as your starting point. What we did was we compared the percentage of annual invoicing with last year's fourth quarter, which was low. We estimate the impact was roughly $80 million in the fourth quarter, somewhere around there. As I said earlier, if you compare it with where we were 4, 5 years ago, it's actually not that different. So we've seen this steady, very slow degradation in annual invoicing over the last few years, and we're really just -- we've got a real program now to obviously reverse that trend.

And your final question comes from Brendan Barnicle of Pacific Crest Securities.

That's not in our current plans. We executed really well in the fourth quarter around this initiative, and I think given the response we got from our customers, I don't see a need to involve a third party. I think the response was good regardless of whether they were small, medium or large customers.

All right. That wraps up my call for today. Unfortunately, we don't have any more time. I see there's more than 15 of you still in the queue, so I apologize for not being able to get to everybody. Before we close, I'd like to remind everyone about our upcoming Cloudforce event scheduled for March 15 at Mosconi West, here in San Francisco. There's no better way to learn about the social enterprise. So we look to see you all there. To register, go to the main website, our main website and you click on the Events tab or you could give us a call here at Investor Relations. That concludes our call today. Thanks for joining us, and we look forward to seeing you soon at the Salesforce events. Bye-bye now.

Ladies and gentlemen, this does conclude today's conference. Thank you for your participation. You may now disconnect.