Google joins corporate software fray (FT)

Google on Monday fired the opening shot in a new long-term battle with corporate software giants like Microsoft and IBM, as it launches new versions of Gmail and some of its other consumer internet services designed for workplace use.

The initiative takes the internet company into a new market called “software as a service,” where companies rely for some of their technology on services delivered over the internet, rather than buying software to run on their own machines.

“I think it’s an incredible opportunity: software as a service is really taking off, because you only buy what you want,” said Dave Girourd, general manager of Google’s enterprise group. “Our view is that a lot of our consumer applications over time really make sense as corporate applications.”

Corporate Gmail, which companies will be able to brand with their own names, will carry advertising, like the consumer version. Google said that by the end of the year it planned to offer a separate version that companies would pay a subscription for.

However, while the rapid growth of new companies like Salesforce.com has demonstrated the appeal of software as a service, this is still a nascent market where most big companies are still treading carefully, analysts warned.

“Companies won’t drop everything and move en masse to Google,” said Matt Brown, a senior analyst at Forrester Research. Particularly when it comes to the communications and collaboration tools used by office workers, “they face all kinds of security and privacy issues” that will make them hesitant to switch, he added.

Defending the reliability and security of its services, Mr Girouard said: “All of these are very important to consumers as well.” He added, though, that Google would also seek to make its products more appealing to big companies, for instance with a support service and with features designed to meet regulatory requirements that public companies have to follow.

He also suggested that Google is likely to extend other services to the corporate market, such as word processing and spreadsheets, which offer lightweight alternatives to some of the features of Microsoft’s Office package of PC software. Referring to Google’s online word processor, Mr Giroard said: “It’s pretty clearly a good candidate, as are other Google applications.”

Microsoft has created online services of its own under the Windows Live brand, but has so far stopped short of offering an online word processor or other services that could be seen as competitors to Office. However, some of the communications and file-sharing tools it has already made available online are more advanced than those that Google is launching on Monday, said Mr Brown.

While they are unlikely to appeal to big companies, Google’s online applications may be taken up by “small businesses, families, educational institutions, ones that don’t have big budgets for IT departments,” said Mr Brown.

Google began a limited limited trial of the Gmail service for corporate users earlier this year. Other services offered beginning Monday are Google Calendar, Google Talk and Page Creator, a tool for creating web pages.

The search engine company launched its first product for corporate customers, a “search appliance” that can be plugged into a corporate network and be used to search a company’s internal data, two years ago.
Copyright The Financial Times Limited 2006

salesforce.com and The Long Tail; Umbria Tracks Word of Mouth (AMR)

I recently talked to salesforce.com’s Marc Benioff about some of the new developments in the market, and how his company is taking advantage of them. I also met with Mr. Kaushansky of Umbria, a unique firm that’s combing the web to see what people are saying about your company and products so you don’t have to.

Inside the On-Demand World of RightNow Technologies (AMR)

We caught up this week with Greg Gianforte, founder and CEO of RightNow Technologies. RightNow, the leader in providing customer service applications via a software-as-a-service (SaaS) or on-demand model, is the second largest CRM on-demand provider after salesforce.com.

SMEs: Is it time to adopt software as a service? (FT)

For small and mid-sized companies outside the IT industry, running IT infrastructure is rarely a core competence. All too often it is an area – and a cost – that senior management feels it cannot control.

One group of technology companies believes it has the answer. Just as few businesses run their own power generators, water plants or telephone exchanges, these companies argue that software should also be a service.

The appeal of this to mid-sized companies is clear. Rather than develop the IT infrastructure and expertise to run business applications, companies go to a service provider to hire the application.

There is no need to pay in advance for software licences or for hardware; a web browser and broadband connection is all the IT infrastructure most companies need. This leads to low initial costs and quick payback periods.

“We have seen a return on investment within 16 months,” says Jim Benson, chief technology officer at KP Corporation, a California-based direct mail and printing company.

Such advantages have made software as a service one of the fastest growing segments of the IT market.

Selling software-as-a-service (Saas) are companies such as Salesforce.com and Netsuite. SAP has a Saas offering and the IT vendors HP and IBM also have significant interests.

But software as a service does not provide all the answers to management teams who want to regain control of IT spending – not yet, at least.

Although some multinational companies are using Saas, smaller businesses are more cautious. According to Forrester Research, 59 per cent of US businesses with between 500 and 999 employees would consider Saas. But for companies with fewer than 100 staff, that falls to 44 per cent.

One reason could be that it is still a fairly young market. The choice of applications is more limited than for inhouse software, and there are concerns about customisation, integration and security.

The entry of large companies such as SAP, as well as blue-chip customers buying from the newer providers, will give directors of smaller companies more confidence. “Small companies have been told to use small company products. But we are running Cisco and Merrill Lynch and ABN Amro on the same server as thousands of SMEs,” says Marc Benioff, chief executive of service-based CRM vendor Salesforce.com.

Access to large company software at an affordable price is a persuasive argument in favour of Saas for SMEs. But Mr Benioff notes that the technology is about more than price. It is also about removing risk. “It is common to hear of failures in large software implementations,” he says. “Customers don’t fail with us.”

Saas has so far focused on a handful of applications, mostly sales and marketing and CRM. A mid-sized company wishing to move most, if not all, software to a service-based model will find it hard.

That could change, and the market could extend well beyond back office applications. Even Microsoft, with its Office Live and Windows Live launches, is testing the waters for Saas.

“The next generation of software applications will look like the internet,” says Zach Nelson, chief executive of Netsuite. “One by one, the objections to using net-based software are falling away.”

Many mid-sized businesses already use net-based applications, from hosted e-mail to search services such as Google. Salesforce is also, through its AppExchange platform, promoting other Saas products.

But there are vital practical considerations when moving to Saas. Businesses need to consider the robustness of the service, and how easy it would be to extract their data, should they part company with the service provider.

Here, software vendors with both service and conventional offerings score, because there is the option to run the application inhouse.

Businesses might also be happy to run CRM as a service because it is relatively easy to set up, and there is a choice of vendors.

But other applications, such as enterprise resource planning may be more difficult to buy as a service because of the need for tight integration with internal business processes, cautions Liz Herbert, an expert on Saas at industry analysts Forrester Research.

She adds: “Because software as a service has made it so easy to buy [technology], companies might not be thinking about security, long-term integration or other practicalities. The buyers are not IT people and have never written a contract for IT services,” says Ms Herbert.

Business Essentials: Geschäftsanwendungen im Browser (contentmanager.de)

Innovation Gate ist mit seiner neuartigen Hosting-Lösung Business Essentials auf großes Interesse bei kleinen und mittelständischen Unternehmen gestoßen. Bereits während des Betatests haben sich über 150 Unternehmen zur Nutzung Ihrer Instanz von Business Essentials registriert. Seit dem 2. Mai ist Business Essentials nun offiziel als Version 1.0 verfügbar.

Software as a service: The next big thing (InfoWorld)

New Office Threat Appears on the Horizon (Client Server News)

Well, by the looks of it, Microsoft is fated to suffer an updated, 21st century, technological version of the legendary Chinese torture – death by a thousand paper cuts.

On the heals of Google buying software-as-a-service start-up Upstartle LLC and its Writely.com beta word processor a couple of weeks ago – which has got to rattle Microsoft’s cage considering it’s Google – Michael Robertson, the guy who started Linspire, née Lindows, the Linux operating system company that managed to defy logic and cop a $20 million settlement out of Microsoft after Microsoft sued it for trademark infringement – talk about the world being topsy-turvy – has just unveiled a thing called ajaxWrite – his idea of an software-as-service alternative to Microsoft’s vaunted cash-cow Office software.

What is Software as a Service? (TEC)

Though born from the ashes of traditional hosting models, software as a service differs fundamentally from its predecessors. Its software is designed to be delivered as a service, security is better, rich user interfaces are available, and it has greater interactivity.

Salesforce.com unleashes Unlimited (InfoWorld)

In a departure from its traditional upgrade schedule that usually coincides with the change of seasons, Salesforce.com (Profile, Products, Articles) today announced Unlimited Edition, a product line that will sit above Enterprise Edition.

Blogwatch: Calling Out Salesforce.com (Line56)

Gartner Michael Maoz says: Crumbs for Research, Millions for Personal Enrichment: This Is No Way to Build Great Software

Need a Salesforce.com Account? (Salesforce.com)

Need a Salesforce.com Account?
30-Day Free Trial of the Leading On-Demand CRM Solution

Register now and for thirty days you'll have full access to all the features and capabilities that make salesforce.com the world's most customizable CRM.

Introducing the World's First On-Demand Application-Sharing Service (Salesforce.com)

Introducing the World's First On-Demand Application-Sharing Service
A new way to browse, share, and install on-demand applications
First came Web sites like Amazon.com and eBay. Then virtual music centers put songs at people's fingertips. So why hasn't someone created an iTunes for business applications?

Now they have. The AppExchange from salesforce.com makes finding and installing new on-demand applications as easy as downloading a song or buying a book online.

With the AppExchange, companies can browse and test drive dozens of new on-demand applications and install them into any salesforce.com account with just a few clicks.

The AppExchange is the world's first on-demand application-sharing service. It's a new online center where salesforce.com subscribers, partners, and developers can share their on-demand applications for everything from handling expense management to tracking purchasing, monitoring recruiting, and beyond. Visit the AppExchange now.

Provisioning Software as a Service (Salesforce.com/Gartner)

Findings From the 'All Software' Research Meeting:
Provisioning Software as a Service
by Jeff Comport
Gartner, Inc.

Recently, salesforce.com raised the bar for the software-as-a-service model by moving beyond the locked-down functionality historically associated with subscription software providers and offering flexible, tool-oriented, multitenancy applications for sales and other CRM-oriented functions.

ANALYSIS
The recently announced salesforce.com AppExchange partner program enables ISVs to publish their applications using a software-as-a-service (SaaS) model and salesforce.com's infrastructure and tools (a platform lock-in), accessed via a Web front end. The leverage and profitability lie in salesforce.com's architecture and infrastructure delivery framework, a single database, a multitenant host for all customer data, data model variations, and business functionality customization. The tenant-by-tenant variability of both data model and process is achieved through high virtualization, down to a virtual data management service that "floats" above physical DBMS tables. The challenge will be to preserve the leverage of multitenancy as more diverse applications (such as non-CRM) demand high processing power for virtualization layers, possibly requiring a "box" per partner, similar to one-off hosted application models (like ASPs). We'll see a rise in these platforms and exchanges from many sources: Yahoo, Google, Visa, eBay and others (which are offering business function "segments" like shopping carts and credit verification). They will change the way software is built and deployed. Indeed, we expect that the eBay-Skype combination will ultimately produce "network aware" applications (for collaboration) that can be procured over the net, as required. A key challenge for successful delivery of SaaS, however, will be balancing flexibility with the necessary scale and leverage to maintain a robust infrastructure (such as secure separation of rules, definitions and business data in a multitenant business model).

Bottom Line: Users should begin investigating and testing SaaS providers for specific, well-defined business tasks that can be integrated into larger business services.

(This research has been independently produced by Gartner research analysts without any review of or participation by any member of Gartner's board of directors, including Maynard Webb, who serves on Gartner's board of directors and is the chief operating officer of eBay Inc.)

Gartner Research G00131696, 29 September 2005.

Provisioning Software as a Service (Salesforce.com/Gartner)

Provisioning Software as a Service (Salesforce.com/Gartner)

Findings From the 'All Software' Research Meeting: Provisioning Software as a Service by Jeff Comport Gartner, Inc. Recently, salesforce.com raised the bar for the software-as-a-service model by moving beyond the locked-down functionality historically associated with subscription software providers and offering flexible, tool-oriented, multitenancy applications for sales and other CRM-oriented functions. ANALYSIS The recently announced salesforce.com AppExchange partner program enables ISVs to publish their applications using a software-as-a-service (SaaS) model and salesforce.com's infrastructure and tools (a platform lock-in), accessed via a Web front end. The leverage and profitability lie in salesforce.com's architecture and infrastructure delivery framework, a single database, a multitenant host for all customer data, data model variations, and business functionality customization. The tenant-by-tenant variability of both data model and process is achieved through high virtualization, down to a virtual data management service that "floats" above physical DBMS tables. The challenge will be to preserve the leverage of multitenancy as more diverse applications (such as non-CRM) demand high processing power for virtualization layers, possibly requiring a "box" per partner, similar to one-off hosted application models (like ASPs). We'll see a rise in these platforms and exchanges from many sources: Yahoo, Google, Visa, eBay and others (which are offering business function "segments" like shopping carts and credit verification). They will change the way software is built and deployed. Indeed, we expect that the eBay-Skype combination will ultimately produce "network aware" applications (for collaboration) that can be procured over the net, as required. A key challenge for successful delivery of SaaS, however, will be balancing flexibility with the necessary scale and leverage to maintain a robust infrastructure (such as secure separation of rules, definitions and business data in a multitenant business model). Bottom Line: Users should begin investigating and testing SaaS providers for specific, well-defined business tasks that can be integrated into larger business services. (This research has been independently produced by Gartner research analysts without any review of or participation by any member of Gartner's board of directors, including Maynard Webb, who serves on Gartner's board of directors and is the chief operating officer of eBay Inc.) Gartner Research G00131696, 29 September 2005.

Introducing the World's First On-Demand Application-Sharing Service A new way to browse, share, and install on-demand applications First came Web sites like Amazon.com and eBay. Then virtual music centers put songs at people's fingertips. So why hasn't someone created an iTunes for business applications? Now they have. The AppExchange from salesforce.com makes finding and installing new on-demand applications as easy as downloading a song or buying a book online. With the AppExchange, companies can browse and test drive dozens of new on-demand applications and install them into any salesforce.com account with just a few clicks. The AppExchange is the world's first on-demand application-sharing service. It's a new online center where salesforce.com subscribers, partners, and developers can share their on-demand applications for everything from handling expense management to tracking purchasing, monitoring recruiting, and beyond. Visit the AppExchange now.

Need a Salesforce.com Account? 30-Day Free Trial of the Leading On-Demand CRM Solution Register now and for thirty days you'll have full access to all the features and capabilities that make salesforce.com the world's most customizable CRM.

Eight Golden Rules to CRM Success Thinking about implementing CRM? Before you put a solution in place, you need to master the Eight Golden Rules for CRM Success. What are they? Find out by joining us in for a Webinar. Salesforce.com CRM Success Expert Wendy Close will show you how to become a customer-centric enterprise-from setting a CRM vision to selecting the right metrics for tracking success. Don't miss your chance to hear directly from CRM experts including Scott Nelson, VP, and Distinguished Analyst, at Gartner. Take home actionable strategies for CRM success. Register to download this FREE Webinar now at: Eight Golden Rules to CRM Success.

Gartner on the Five-Year TCO for CRM On-Demand A major driver for deploying CRM on-demand is its lower cost of ownership. According to Gartner, "Through 2010, CRM on-demand will provide as much as 10 percent to 13 percent lower five-year TCO than on-premise software for moderately complex CRM deployments (0.7 probability). Companies with simple to moderate CRM complex requirements should consider CRM on-demand services as a way to lower five-year total cost of ownership." For more of this topic visit: Five Year TCO Lower for On-Demand. (Source: Gartner Inc., Gartner CRM Summit, "CRM OnDemand: The Myth and Promise of No Software," by Rob DeSisto, October 31, 2005.)

Improving Service & Support Operations Lots of organizations use salesforce.com for managing sales operations. However, a rapidly growing number have integrated their sales and service operations by using Salesforce Service & Support (formerly named Supportforce). Salesforce.com has about 1700 customers using Salesforce Service & Support to improve their customer service and support operations and more. For example, they're using the solution to manage a total of 12 million cases. For more of this topic visit: Improving Service & Support Operations.

Misys Banking Systems Deploys Salesforce Service & Support across 10 Countries in 11 Weeks - Anticipates Return on Investment in Less Than 12 Months Every year, more than 100,000 tellers at 450 banks in 100 countries rely on Misys Retail Banking systems to process 10 billion transactions. Business disruption is simply not an option. "Salesforce.com is one of the critical factors in Misys Banking Systems customer support infrastructure, providing support teams around the world with a real-time, accurate and unified view of every customer situation," said Peter Middleton, Customer Services Director, Misys Banking Systems. For more on how Misys is achieving CRM success, visit: Misys Banking Systems Deploys Salesforce. Provisioning Software as a Service is published by Salesforce.com. Editorial supplied by Salesforce.com is independent of Gartner analysis. All Gartner research is © 2006 by Gartner, Inc. and/or its Affiliates. All rights reserved. All Gartner materials are used with Gartner's permission and in no way does the use or publication of Gartner research indicate Gartner's endorsement of Salesforce.com's products and/or strategies. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice.

Provisioning Software as a Service (Salesforce.com/Gartner)

Findings From the 'All Software' Research Meeting: Provisioning Software as a Service by Jeff Comport Gartner, Inc. Recently, salesforce.com raised the bar for the software-as-a-service model by moving beyond the locked-down functionality historically associated with subscription software providers and offering flexible, tool-oriented, multitenancy applications for sales and other CRM-oriented functions. ANALYSIS The recently announced salesforce.com AppExchange partner program enables ISVs to publish their applications using a software-as-a-service (SaaS) model and salesforce.com's infrastructure and tools (a platform lock-in), accessed via a Web front end. The leverage and profitability lie in salesforce.com's architecture and infrastructure delivery framework, a single database, a multitenant host for all customer data, data model variations, and business functionality customization. The tenant-by-tenant variability of both data model and process is achieved through high virtualization, down to a virtual data management service that "floats" above physical DBMS tables. The challenge will be to preserve the leverage of multitenancy as more diverse applications (such as non-CRM) demand high processing power for virtualization layers, possibly requiring a "box" per partner, similar to one-off hosted application models (like ASPs). We'll see a rise in these platforms and exchanges from many sources: Yahoo, Google, Visa, eBay and others (which are offering business function "segments" like shopping carts and credit verification). They will change the way software is built and deployed. Indeed, we expect that the eBay-Skype combination will ultimately produce "network aware" applications (for collaboration) that can be procured over the net, as required. A key challenge for successful delivery of SaaS, however, will be balancing flexibility with the necessary scale and leverage to maintain a robust infrastructure (such as secure separation of rules, definitions and business data in a multitenant business model). Bottom Line: Users should begin investigating and testing SaaS providers for specific, well-defined business tasks that can be integrated into larger business services. (This research has been independently produced by Gartner research analysts without any review of or participation by any member of Gartner's board of directors, including Maynard Webb, who serves on Gartner's board of directors and is the chief operating officer of eBay Inc.) Gartner Research G00131696, 29 September 2005.

Introducing the World's First On-Demand Application-Sharing Service A new way to browse, share, and install on-demand applications First came Web sites like Amazon.com and eBay. Then virtual music centers put songs at people's fingertips. So why hasn't someone created an iTunes for business applications? Now they have. The AppExchange from salesforce.com makes finding and installing new on-demand applications as easy as downloading a song or buying a book online. With the AppExchange, companies can browse and test drive dozens of new on-demand applications and install them into any salesforce.com account with just a few clicks. The AppExchange is the world's first on-demand application-sharing service. It's a new online center where salesforce.com subscribers, partners, and developers can share their on-demand applications for everything from handling expense management to tracking purchasing, monitoring recruiting, and beyond. Visit the AppExchange now.

Need a Salesforce.com Account? 30-Day Free Trial of the Leading On-Demand CRM Solution Register now and for thirty days you'll have full access to all the features and capabilities that make salesforce.com the world's most customizable CRM.

Eight Golden Rules to CRM Success Thinking about implementing CRM? Before you put a solution in place, you need to master the Eight Golden Rules for CRM Success. What are they? Find out by joining us in for a Webinar. Salesforce.com CRM Success Expert Wendy Close will show you how to become a customer-centric enterprise-from setting a CRM vision to selecting the right metrics for tracking success. Don't miss your chance to hear directly from CRM experts including Scott Nelson, VP, and Distinguished Analyst, at Gartner. Take home actionable strategies for CRM success. Register to download this FREE Webinar now at: Eight Golden Rules to CRM Success.

Gartner on the Five-Year TCO for CRM On-Demand A major driver for deploying CRM on-demand is its lower cost of ownership. According to Gartner, "Through 2010, CRM on-demand will provide as much as 10 percent to 13 percent lower five-year TCO than on-premise software for moderately complex CRM deployments (0.7 probability). Companies with simple to moderate CRM complex requirements should consider CRM on-demand services as a way to lower five-year total cost of ownership." For more of this topic visit: Five Year TCO Lower for On-Demand. (Source: Gartner Inc., Gartner CRM Summit, "CRM OnDemand: The Myth and Promise of No Software," by Rob DeSisto, October 31, 2005.)

Improving Service & Support Operations Lots of organizations use salesforce.com for managing sales operations. However, a rapidly growing number have integrated their sales and service operations by using Salesforce Service & Support (formerly named Supportforce). Salesforce.com has about 1700 customers using Salesforce Service & Support to improve their customer service and support operations and more. For example, they're using the solution to manage a total of 12 million cases. For more of this topic visit: Improving Service & Support Operations.

Misys Banking Systems Deploys Salesforce Service & Support across 10 Countries in 11 Weeks - Anticipates Return on Investment in Less Than 12 Months Every year, more than 100,000 tellers at 450 banks in 100 countries rely on Misys Retail Banking systems to process 10 billion transactions. Business disruption is simply not an option. "Salesforce.com is one of the critical factors in Misys Banking Systems customer support infrastructure, providing support teams around the world with a real-time, accurate and unified view of every customer situation," said Peter Middleton, Customer Services Director, Misys Banking Systems. For more on how Misys is achieving CRM success, visit: Misys Banking Systems Deploys Salesforce. Provisioning Software as a Service is published by Salesforce.com. Editorial supplied by Salesforce.com is independent of Gartner analysis. All Gartner research is © 2006 by Gartner, Inc. and/or its Affiliates. All rights reserved. All Gartner materials are used with Gartner's permission and in no way does the use or publication of Gartner research indicate Gartner's endorsement of Salesforce.com's products and/or strategies. Reproduction of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice.

Salesforce.com Seen As Leader In Software-As-Service (Forbes)

Banc of America Securities analyst Daniel Cummins maintained a “neutral” rating and $38 price target on Salesforce.com after the company reported fourth-quarter results.

On Wednesday, Salesforce.com (nyse: CRM - news - people ) reported fiscal fourth-quarter 2006 earnings of 5 cents per share, in-line with the consensus estimate and the analyst’s estimate. The company reported revenue of $91 million, in-line with the analyst’s estimate and slightly below the consensus estimate of $92 million.

SAP makes CRM hosting move (vnunet)

SAP has finally made its big move into hosted customer relationship management (CRM) software. The German giant’s CRM On Demand Solution will aim for large and mid-market firms with a per-user monthly subscription service hosted by partner IBM.

SAP Enters SaaS Market (webpronews)

Yesterday, the German enterprise software vendor SAP announced it is entering the hosted software-as-a-service (SaaS) market with the expansion of its mySAP CRM offering to include a hosted option.

SAP steps into the software-as-a-service arena (InfoWorld)

It’s as momentous as when the Union Pacific met the Central Pacific and the final, golden, spike was driven at Promontory Summit, Utah, completing the transcontinental railroad -- not that in high tech anyone would notice an event as significant. I can’t even predict for you all the innovations that will be generated from the recent developments, but I will give you my thoughts.

SAP through the browser (InfoWorld)

CRM OnDemand to be launched