Internet search giant Google and software-as-a-service leader Salesforce.com are combining two products to take on Microsoft. The companies planned to...
Internet search giant Google and software-as-a-service leader Salesforce.com are combining two products to take on Microsoft.
The companies planned to release a joint offering called Salesforce for Google Apps today, combining online customer relationship management software with productivity applications.
The pairing will compete with Microsoft Dynamics CRM Online. It also points toward the companies’ designs on Microsoft’s broader business-software offerings.
“This is freedom to focus on the benefits and not focus on the software,” said Bruce Francis, vice president of corporate strategy at Salesforce.
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Salesforce will make Google Apps, a suite including Web-based e-mail, word processing, chat, presentations and spreadsheets, available free to its more than 41,000 business customers. Those customers have more than 1 million paying users of the Salesforce software.
This summer, the company plans to begin selling a “supported” version of Salesforce for Google Apps with unified billing and interfaces to link the online software with existing systems, which, among other things, would allow customers to migrate from Microsoft e-mail products to Gmail.
The supported version will be resold to Salesforce customers on a subscription basis for $10 per user, per month, in addition to subscription fees for Salesforce’s CRM software. Salesforce would not disclose terms of its agreement with Google.
The companies have worked together to integrate their products. One feature automatically logs e-mail sent to a customer in the CRM software. Another overlays marketing events on an individual’s calendar.
The Salesforce and Google approach to selling software bypasses the traditional desktop and server model that Microsoft has dominated. Software as a service, or SAAS, eliminates the need for on-premise servers and IT departments to maintain them. The software itself is accessed through an Internet-connected computer.
“They have similar views of the world and it’s very complementary,” David Mitchell Smith, an analyst with Gartner, said of the Google-Salesforce effort.
Microsoft is building on a strategy it calls “software plus services,” emphasizing that an important role still exists for desktop software.
A strong point for Microsoft’s Dynamics business applications is their integration with Office and other major business products.
“In a way it sounds like Salesforce wants to be able to do the same thing,” said Greg DeMichillie, an analyst with Directions on Microsoft. “They want to be part of a bigger offering that includes e-mail and documents and spreadsheets.”
He called the Salesforce deal “a significant distribution win” for Google Apps.
Smith said online business software has been adopted in large businesses from the bottom up, with individual users or departments using these products rather than companywide deployments.
Google Apps may not threaten Microsoft’s business products immediately, but as more computing shifts from the desktop to the Web, the company’s vulnerability grows.
“That’s where the real threat is,” DeMichillie said. “It’s not in 2009 that Google Apps gets massive share from Office, it’s 2019 or somewhere in between.”
Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com