(Reuters) - Microsoft Corp. said on Tuesday it plans to introduce a Web-based version of its sales and marketing software in 2007 as it targets rivals like Salesforce.com, Oracle Corp., and SAP AG (SAPG.DE) in a fast-growing market.
Microsoft said the service initially would target small businesses. Analysts said it showed that the world's biggest software maker is serious about meeting growing demand for applications delivered over the Internet, reports Trend.
Rob Bois, an analyst at AMR Research, said the upcoming service would give Microsoft a foothold in a burgeoning part of the estimated $11 billion market for so-called customer relationship management, or CRM, software that helps companies manage sales forces and track sales leads.
"All eyes are on Microsoft and how they are going to compete in this emerging market," Bois said. "This is one more affirmation that they are serious about competing and that they are not just content with competing in the client-server model."
The new offering also is part of a larger Microsoft push into Web services marked by its strategy to take on Google and Yahoo with its "Live" initiative ranging from Windows Live -- an advertising-funded, one-stop shop for services like e-mail and instant messaging -- to Office Live business applications.
The Redmond, Washington-based company said it plans to introduce Microsoft Dynamics CRM Live in North America in the second quarter of 2007 and offer it on a monthly subscription basis.
Both Oracle and SAP already offer their own versions of Web-based CRM business applications.
Microsoft's offering helps it challenge Oracle and SAP along with upstart Salesforce.com, which has seen growth as customers turn to its Web-based software that is often easier to maintain and use than traditional applications installed on individual computers, analysts said.
"It is part of a bigger trend that applications vendors need to offer as a deployment option," she said. "This will allow Microsoft to better compete," said Liz Herbert, an analyst at Forrester Research.
Microsoft said it would disclose pricing and licensing details for Microsoft Dynamics CRM Live after it finishes testing the service with customers.
The Web-based service is also part of the "Microsoft Dynamics" brand software, which the company introduced last year as its latest line of business applications.
Currently, Microsoft sells its CRM software on CDs or via the Web through partners. The new service will give customers the choice to purchase it directly from Microsoft, said Brad Wilson, general manager for Microsoft Dynamics CRM.
Microsoft executives have said CRM could represent the company's next billion dollar business, and Wilson said Web-based tools are critical. He predicted such applications would one day make up 25 percent of the overall CRM market -- giving Microsoft plenty of room to grow.
"We want to make sure we maximize the choice we give to our partners and customers," Wilson said.
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