Brace Yourself For The Battle Of The CRM Titans

Sandbox, running on Salesforce.com&'s existing server infrastructure, “will be important for integrators working with our customers,” said George Hu, vice president and general manager of San Francisco-based Salesforce.com. “It&'ll give them a great environment to test out customizations and changes before deploying them live.”

Salesforce.com is trying to leverage third-party tools and apps in its three-month-old AppExchange repository. “Partners and developers can post apps and share them with our customer base,” said Hu, who characterized AppExchange as “the eBay of applications.” AppExchange debuted in September and now claims 80 applications.

Sandbox, to go live with the winter 2006 Salesforce.com update, will provide “trusted advisers with a safe place to test-drive these new applications on a clone of the customer&'s current production environment,” Hu said.

The news comes just after Microsoft, Redmond, Wash., unveiled Dynamics CRM 3.0, which it offers via standard service provider licensing agreements for hosting partners. With the new CRM, reseller price is $24.95 per user per month. Partners then can charge margin to cover customization and infrastructure costs and still offer their implementation for less than the $125 per user per month Salesforce.com charges for its EnterpriseEdition or $99 per user per month for Salesnet&'s comparable hosted CRM.

The new Microsoft CRM is more "Internet facing than intranet facing, which will make it easier for us to interface to customers' apps," said Mark Clayman, senior vice president of hosting at Navisite, an Andover, Mass.-based Microsoft hosting partner. Clayman said the official SPLA pricing will also make it easier to sell against Salesforce.com.

Both Salesnet and Salesforce.com were quick to seize on the fact that Microsoft&'s latest release still does not support multitenancy. That means hosters have to dedicate a server to each customer account. General Manager of Microsoft CRM Brad Wilson said the next release of CRM, code-named Titan, will offer such support. He denied Microsoft has any near-term plans to host CRM for customers, although partners say other Microsoft executives have said to expect that option next year.

“If you&'re a partner, you have a choice. You can build your own data center and assume all the cost that goes with that complex security, reliability, in order to host Microsoft CRM, or the alternative is to work with Salesforce to build things complementary to our platform without those costs, with no complexity, and we represent a channel to market,” said Phil Robinson, senior vice president of global marketing at Salesforce.com.

Jonathan Tang, president of Salesnet, Boston, said despite a two-year wait, Microsoft “still falls short in delivering a multitenant product. The Titan release should go a long way in addressing the high demand for a true multitenant product, but without a solid release date, vendors like Salesnet will continue to deliver hosted solutions to the channel through a robust and scalable infrastructure.”