Sage Sends SalesLogix to the Cloud

DENVER — Sage is officially — and finally — bringing its CRM to the cloud.

At its recent annual Insights event here, the business solution provider announced that it is putting its CRM software Sage SalesLogix on Amazon.com's Elastic Compute Cloud (EC2) infrastructure. Sage SalesLogix Cloud, which was introduced to partners last year, will be available to customers in June.

To provide context for Sage's "cloudy" announcement, Bruce Guptill, senior vice president and head of research at analysis firm Saugatuck Technology, shared survey results indicating that an average of 20 percent of firms today use such cloud-based solutions for at least one core business system. The figure, Guptill predicted, will double by year-end 2012. 

"A couple of years ago, if you wanted to be good at SaaS, you had to be good at the infrastructural level -- and hats off to them," said Larry Ritter, senior vice president and general manager of Sage CRM Applications. "We have always been at the applications."

Along with Joe Bergera, executive vice president and global general manager for Sage CRM Solutions, Ritter explained the cloud solution in depth during a press and analyst session here. 

Sage took an incremental approach with the cloud offering. Bergera said the solution was made available to select "handheld customers" in December. Twelve customers have been signed on with the Amazon subscription-based solution to-date. Hundreds more are using it through a SalesLogix trial. Prior to the cloud solution Sage was limited in offering trials to customers.

"We are actually getting a lot of traction just by having the solution," offered Allen Duet, senior product manager for Sage CRM. Some customers, in fact, have signed on with Sage on-premise CRM just for knowing that the vendor has a cloud offering on tap that it could migrate to in the future. 

Sage is calling this June release Phase 1 of SalesLogix Cloud. The solution will be expanded to international partners and customers later this year. Also a new version of SalesLogix on-premises will be released in the next 6 weeks. SalesLogix Cloud is offered to customers in two ways. Customers can provide named users who will access the solution, or companies can pay for five "concurrent users" and rotate the licenses throughout the organization on an as-need basis. 

Sage deals primarily through a partner channel, which may be an explanation of the year-long ramp-up of the cloud solution. "Some partners really stepped up to the plate," Ritter reported. "The ones attacking this opportunity are seeing overall pipeline expand." He noted, however, that the value proposition for partners is different. "You aren't going to make the same kind of money that you used to," he said. 

In terms of Act!, Bergera said Sage is focusing on the connected services to bring users online. The Sage e-Marketing application, for example, offers customers the reach of the Web, but keeps the core contact management system where many users want it -- on the desktop. Ritter speculated that Sage might some day want to do something similar with Act! and the cloud, but the price point does not make sense right now. 

Ritter hinted at a handful of connected services to come later this summer. One of particular interest for CRM users will be an integrated Web service with Hoover's.

Beagle Research Principal Denis Pombriant notes that the SalesLogix cloud solution may be on the periphery of being called a software-as-a-service application. Pombriant wagers that Sage is more fittingly categorized as an application service provider (ASP) since Amazon is the company doing the hosting. 

Ritter said that the company is ultimately working down the path toward becoming a hybrid service provider where companies use both installed Sage products and Web services. After all, Sage's definition of cloud, as iterated by Himanshu Palsule, Executive Vice President of Product Strategy and Marketing of Sage Business Solutions at Tuesday's keynote, means "taking the richness of on-premise applications and connecting it to the reach of Web services." 

With Act! reaching out to the Web for extensions, and with SalesLogix finding its place in the cloud, executives hinted that a Sage application store in the cloud may be a big move to come. 

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.

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