Microsoft Event Highlights Hosted CRM Apps

Channel partners and customers will gain early access to Microsoft's hosted CRM applications later this quarter with the on-demand application slated for general availability in 2008, Microsoft executives announced last month at the vendor's Worldwide Partner Conference in Denver.

The company also disclosed pricing for the Microsoft Dynamics Live CRM hosted software: $39 per user per month for a Professional version as an introductory price through 2008, increasing to $44 per user per month in 2009. An Enterprise version, which will add offline data synchronization capabilities, will have a price tag of $59 per user per month, according to Brad Wilson, general manager of Microsoft Dynamics CRM.

Channel partners that resell the Microsoft Dynamics Live CRM hosted by Microsoft will get 10 percent of that subscription license fee annually as long as the customer remains on the system, Wilson says.

The announcements are centered on Titan, the next generation of Microsoft Dynamics CRM software the Redmond, Wash., software giant is fielding to compete against such CRM suppliers as NetSuite, Oracle, Sage, Salesforce.com and SAP. In addition to an on-premise version of the application, Microsoft for the first time will be offering versions that are hosted by Microsoft within its own data centers or by channel partners and third-party companies. Channel partners will have the option of selling the software all three ways, along with building a range of implementation, integration and consulting services around them. "Our partners have multiple ways to make money in this environment," Wilson says.

Some solution providers say the hosted version of the CRM application will provide them with more sales options when working with small businesses--those, say, with 25 to 50 seats--that may lack Microsoft's SQL Server database and other supporting IT systems.

"This will allow us to sell to companies [that] wouldn't buy before because they didn't have the infrastructure," says Mike Snyder, a principal with Sonoma Partners, a Chicago-based solution provider that works with Microsoft's CRM applications.

But some partners have raised concerns that the hosted CRM applications, which Microsoft will make directly available to customers for a subscription fee, could compete with channel partners. In a keynote speech at the partner conference, Klaus Holse Andersen, corporate vice president in charge of Microsoft Dynamics sales and operations, acknowledged those worries and pointed out that early access for customers to the hosted and on-premise CRM software would be available only through channel partners.

Next: Early Access