Looking to marry open-source technology and the growing demand for cloud computing, Cupertino, Calif.–based open-source CRM pioneer SugarCRM has unveiled a new solution geared -- and priced to sell -- to small-business users. The new product, called Sugar Express, is available on Sugar Open Cloud, the company's on-demand computing platform.
Martin Schneider, director of product marketing for SugarCRM, says that Sugar Express is intended to fill a gap between the free community edition of the company's product and its professional and enterprise versions. And the timing is no accident: Since the start of the recession, Schneider notes, the number of downloads of SugarCRM's free community edition has risen dramatically -- from approximately 40,000 to 70,000. Sugar Express, he says, was borne out of that rising interest. "We figured, ‘How can we make it even easier for people to get up and running on the core CRM tools we offer and make this an affordable solution for individuals and small offices?' " he says.
The solution will include SugarCRM's core sales, marketing, and support features along with plug-ins for Microsoft Office and cloud connectors to integrate third-party data services from companies including Hoover's and Jigsaw.
[Editors' Note: See another of today's news stories, regarding Jigsaw.]
The annual cost for the solution is $499 for up to five years, and $799 for up to 10 users. "Small businesses are here to provide services and help clients out," Schneider says. "They're not information-technology people that want to manage an open-source product."
Tim Hickernell, lead analyst for Info-Tech Research Group, explains that Sugar Express allows the vendor to compete on a more level playing field with software-as-a-service leader Salesforce.com. "SugarCRM had differentiation but it was hard for customers to be willing to consider it alongside Salesforce.com," he says. "At the low end, SugarCRM's entry-level product is open-source which, on one hand, is competitive because Salesforce.com doesn't have it. At the same time, a large segment of companies looking for low-end CRM are not willing to go open-source."
Hickernell adds that interest remains high among SMBs for full-service on-demand CRM offerings, and Sugar Express can help the open-source vendor target that expansive market opportunity. "I haven't seen that market die," he says. "It gives the option to companies wanting to pay money and have the assurance of having a vendor behind them in support."
In addition to targeting the SMB space, the fact that Sugar Express runs on Sugar Open Cloud represents, according to Schneider, the convergence of open-source and on-demand computing. Key elements of the Sugar Open Cloud include:
- application delivery: multi-instance architecture for automated instance provisioning, configuration, and maintenance;
- integration services: supporting Web services for exchanging and consuming application and data services from the Web;
- open-source standards: adhering to standards that the company claims will ensure portability, low cost, and no vendor lock-in;
- security and fault-tolerance: employing data centers to ensure security, redundancy, and high availability; and
- distributed global monitoring: utilizing 24-by-7 monitoring both within and outside the Sugar Open Cloud to ensure continual delivery of high-speed performance.
Denis Pombriant, founder and managing principal of consultancy Beagle Research Group, says the fact that SugarCRM is trying to penetrate the cloud-computing market is important. "It's interesting that even in the open-source world there is recognition of the importance of cloud computing, and that it needs to step up and deliver solutions that will enable its customers to take advantage," he says.
While SugarCRM is quick to stress that its platform is truly open and not leading to proprietary lock-in, Hickernell believes that, at some level, "there really is a need for vendors, intermediaries, and aggregators to get involved."
To support that contention, Hickernell points to the Web 1.0 world in which start-ups were building on top of each other, a level of interdependence that he contends accelerated the dot-com crash. "Now, it's application services," he says. "It's hard to find new Web 2.0 companies solely built on their own stuff."
In the long run, Hickernell says, vendors such as SugarCRM will have to act more as intermediaries, bridging the cloud-based gap between no control and total proprietary control. "Ultimately, the market will favor intermediaries like Sugar saying it has established partners for the application supply chain it will manage," he says. "It gives you added assurance that if a service you're dependent on goes down, the intermediary will go out, look for a new service, and get it up quickly. People will value the role of software companies being intermediaries on cloud services."
News relevant to the customer relationship management industry is posted several times a day on destinationCRM.com, in addition to the news section Insight that appears every month in the pages of CRM magazine. You may leave a public comment regarding this article by clicking on "Comments" at the top; to contact the editors, please email editor@destinationCRM.com.