If it wasn't enough that Apex, its new on-demand programming language, shares a name with a town in North Carolina...
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that recently suffered a massive chemical fire, Salesforce.com heard plenty of barbs this week from its rivals.
They denounced the San Francisco-based company's new release as everything from a security risk to an admission that the company has ceded ERP and the back office.
"It took NetSuite eight years to build a complete, integrated transactional application to run a midsized business," wrote Zach Nelson, CEO of NetSuite Inc., a San Mateo, Calif.-based CRM and ERP software provider, in an email. "Salesforce.com's soft underbelly is that they can never add a transaction engine to their SFA data model, which ultimately relegates them to being the next-generation, on-demand Siebel to NetSuite's on-demand SAP position."
Salesforce.com's efforts to extend CRM by providing customization -- and now programming tools -- to customers and partners does not mean it's forsaking CRM or that it sees itself as Siebel, countered Sheryl Kingstone, director enterprise applications and mobility strategies with the Boston-based Yankee Group Research Inc. While the promise of becoming an on-demand platform provider may seem alluring, that's not necessarily where Salesforce.com will ultimately head.
"They're not taking their eye off of CRM. That's where their bread and butter is," Kingstone said. "Their user base might pull them in that direction. You get more users without having to build a model like Oracle and SAP. They can't compete with those systems. No one company can provide everything."
SAP, of course, had something to add itself, questioning the security of Apex.
"We think this is a big security risk," said Peter Graf, executive vice president of solutions marketing at SAP. "If you launch a programming language and say you can modify coding that can be used in multi-tenant architecture, you open the door for not only customers changing the code, but everyone running on the same instance."
Salesforce.com insists SAP doesn't get multi-tenancy.
"That's a shame for SAP's customers, who are trapped in an innovation-free environment," Bruce Francis, vice president of Salesforce.com's corporate strategy, wrote in an email. "SAP's customers had a bad experience with [SAP's ABAP programming language], which did expose customers to critical vulnerabilities, so SAP's accusations feel more like a confession here. Apex is a fully protected language that is designed to operate in a seamless and safe fashion with our multi-tenant on-demand service. The Apex language was specifically designed to protect our service from poorly written code."
The Apex move is a move away from enterprise CRM and toward becoming a platform provider, according to Greg Gianforte, CEO of RightNow Technologies Inc., based in Bozeman, Mont. RightNow is another SaaS competitor.
"Seeing their announcement, what became clear is, as Salesforce pursues this infrastructure play, the differentiation between RightNow and Salesforce has become more prominent," Gianforte said. "We continue to build world-class, mission critical applications for enterprise businesses. Salesforce is really focused on building tools for ISVs and is focused on [small and midsized businesses]. Customers want vendors to be focused on business results. The days they want a toolkit and a chemistry project are over."
A hazy shade of Winter
Yet, Salesforce.com does continue to build out its core CRM capabilities. The Winter '07 release, scheduled to be available in the fourth quarter of this year, includes a number of enhancements. A new desktop feature will allow users to personalize their CRM information into multiple windows. Workflow rules will allow users to create custom workflow and approval rules to trigger tasks for managers. The new release will also feature Lotus Notes integration and an Ajax calendar, allowing sales teams to schedule events, meetings and tasks more easily. The Service and Support module will feature an integrated softphone that allows click-to-dial, automatic call logging and screen pops for any record. Salesforce.com's new Kieden Corp. acquisition this summer.
The Apex release, not yet in beta and scheduled for release in conjunction with Winter '07, provides a way to extend CRM via customization, executives said.
"Winter '07 will bring unlimited customization to Salesforce and The Business Web," CEO Marc Benioff said in a statement. "This new level of freedom and flexibility is only possible through the power of mash-ups, open APIs, Web services and the Apex programming language and platform on which salesforce.com is built."
It's a good bet, according to Stamford, Conn.-based Gartner Inc. A recent report from the research firm found that SaaS represented 5% of business software spending in 2005. By 2011, Gartner expects 25% of new business software to be delivered as SaaS.
Meanwhile, seeking to capture some of Salesforce.com's customers, NetSuite this week announced that it is offering existing Salesforce.com Professional Enterprise edition customers a lifetime subscription to NetSuite CRM+ at their most recent subscription fee. Additionally, it is offering free transfer of 100 MB of Salesforce.com data.