• April 22, 2008
  • By Marshall Lager, founder and managing principal, Third Idea Consulting; contributor, CRM magazine

Microsoft Goes Live with CRM Live Online

Microsoft Dynamics CRM Online, a hosted suite of on-demand CRM applications from the big company in Redmond, Wash., became available today for North American subscribers. Formerly known as Dynamics CRM Live, this latest iteration of the software-as-a-service (SaaS) offering is built to capitalize on Microsoft's huge presence among small and medium businesses (SMBs).

A central aspect of Dynamics CRM 4.0 is its multiple deployment options. In addition to the installed version, there is Online (hosted by Microsoft) and a partner-hosted version as well. "We're revolutionizing how companies deploy marketing, sales and service solutions to users within their organization," said Brad Wilson, general manager of Microsoft Dynamics CRM, in a statement. "Microsoft Dynamics CRM delivers the power of choice to customers, with a familiar and productive user experience and a multitenant platform that enables fast on-premise implementations or 'instant-on' deployments over the Internet."

Microsoft is not banking solely on this software plus services approach. Integration and commonalities of interface with popular Microsoft productivity tools such as Outlook and Excel are also hoped to make Dynamics CRM Online an attractive option, as is price. Microsoft has begun an ad campaign targeting Salesforce.com, its chief rival in the SaaS CRM space, hitting each of these points.

The initial versions of Microsoft Dynamics CRM Online have the following features:

  • Microsoft Dynamics CRM Online Professional: 5 gigabytes (GB) of data storage, 100 configurable workflows, and 100 custom entities. The Professional edition is priced at $44 per user per month, with an introductory offer of $39 per user, per month.
  • Microsoft Dynamics CRM Online Professional Plus: 20 GB of data storage, 200 configurable workflows, and 200 custom entities, plus offline data synchronization. The Professional Plus edition is priced at $59 per user per month.

Analysts are watching the development of Microsoft's approach to CRM even as they praise the validation of the SaaS model for SMBs. "Microsoft is trying to leverage its best-known-company status to become the most relevant company as well," suggests Denis Pombriant, founder and managing principal of CRM consultancy Beagle Research Group. "I like the fact that they've invested so much money in the data centers, but 'power of choice' is not enough of a differentiator."

Despite this assessment, and what he calls a notable lack of analytics in the core product (Microsoft will announce analytics in June, but the availability date is not yet confirmed), Pombriant sees Microsoft's SaaS suite as an evolution of the market. "This is the culmination of a long process where on-demand was the gatecrasher, the disruptor," he says. "Once you see adoption by Oracle and Microsoft, you know the technology is mainstream. Microsoft is validating its own product in relation to the evolving market, just as IBM validated the personal computer industry. Salesforce.com and NetSuite, as well as acquired companies like Salesnet, should feel vindicated."

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