Microsoft CRM Pricing and Availability Go Live

DENVER--In a series of announcements at its Worldwide Partner Conference here today, Microsoft revealed plans for the third-quarter launch of its Dynamics Live CRM solution. The software giant released initial pricing and product information, and revealed the first of numerous vertical templates to customize Dynamics CRM for specific industries. Customers in North America will be able to begin using Dynamics Live CRM for free via an early access program (EAP) through the remainder of 2007, according to Brad Wilson, general manager for Microsoft Dynamics CRM. Microsoft expects to start charging for the hosted CRM service in the first half of 2008. Signup for the program, initially targeted at companies with five or more CRM users, will be offered through Microsoft Dynamics CRM's network of certified partners. In terms of pricing, Microsoft will offer two versions of Dynamics Live CRM:

• Dynamics Live CRM Professional: Aimed at companies with five or more CRM users, this edition will be the service Microsoft will offer first, in its free early customer access program this year. Starting in 2008, Professional will have a promotional cost $39 per user per month, rising to $44 per user per month at the beginning of 2009. The service will enable users to access CRM capabilities through Microsoft Outlook and browser clients and will include customizable workflow based on Windows Workflow Foundation.
• Dynamics Live CRM Enterprise: Offering all the capabilities of the Professional product as well as offline data synchronization, this edition will be available in the first half of 2008, Wilson says, and will cost $59 per user per month.

Microsoft also debuted two vertical templates for Dynamics CRM for the public sector and manufacturing industries. The new templates include reference data models, predefined workflows, and roles-based user experiences that customize with just afew clicks everything from the user interface through the back-end data models. These templates--available by July 31 and to be offered at no charge to partners and customers--are designed to work with Microsoft Dynamics CRM 3.0 today, and will be updated for the upcoming release at the end of the year. More vertical templates for other industries will be delivered over the next 12 months, Wilson says. Dynamics Live CRM is one of three deployment options in Microsoft's upcoming "Titan" release of its CRM software, which was first announced in January. Titan will be the first Microsoft CRM release based on a multitenant architecture, using a single code base to support three different deployment models:

• Live CRM (the Microsoft hosted version);
• an on-premise version of the CRM application; and
• a partner-hosted release.

"It's about giving customers the flexibility to switch between deployment models," Wilson says, adding that the on-premise and partner-hosted versions of Titan should appear in the fourth quarter of this year. (The company has yet to commit to a launch date for Dynamics Live CRM outside of North America, but does intend to offer the service internationally, Wilson says.) Over 600 partners have already been hosting Dynamics CRM over the course of 2007, and they will lead the customer EAP, meaning customers will have to go through partners to sign up for the free service. For 2008 and beyond, when customers begin paying for the service, Microsoft also announced a progressive compensation plan for partners, to encourage long-term commitment: For any customers they register for Dynamics Live CRM, partners will receive 10 percent of the annual subscription revenue in Year One, Wilson says, and Microsoft will increase that percentage to 15 percent beginning in Year Two. The decision to allow early access to Dynamics CRM Live is a pragmatic approach to attracting prospects looking for SFA functionality, says Michael Maoz, vice president of research at Gartner. Maoz says Microsoft's initial focus with Dynamics CRM Live will be SFA for B2B companies, not customer service in the contact center, Web self-service or field service. Until Microsoft releases a full functionality set, he adds, it would be difficult to do "an apples-to-apples comparison" of Dynamics Live CRM versus existing Software-as-a-Service (Saas) on-demand CRM from competitors like Salesforce.com and NetSuite. Laurie McCabe, vice president of small and medium business insights for AMI-Partners, agrees, and adds that while the pricing for Dynamics Live CRM is competitive against the Salesforce.com's of the world, it's a pricing model better suited for midmarket organizations. "It's still a little high for small businesses," she says. "You also have to remember there are still plenty of other on-demand options for SMBs to pick from other than Microsoft and Salesforce.com, such as Sage." Related articles: Microsoft: Partnering Up or Partnering Down? Microsoft is making its Dynamics business applications more industry relevant. Microsoft Introduces a New Level of Convergence The company debuts SharePoint Server 2007 as it begins molding the Dynamics product line into a fully integrated suite solution. Microsoft Brings Analytics to the Desktop The software giant releases a BI platform for Dynamics CRM in an effort to hand business intelligence to the Excel-using masses. A New Flavor of Microsoft Dynamics CRM The latest version, called Titan, is released to the company's partner network as Microsoft gears up to begin hosting the solution itself via Dynamics Live.

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