Or perhaps it's something else: Microsoft combats a CRM + cloud colossus

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Customer relationship management (CRM) software has typically fallen outside the realm that Betanews has covered, at least in recent years. It falls outside the realm a lot of publications cover, not because it's the least bit obscure or unimportant or even a segment of the information industry around which billions of dollars in invested capital revolve, but because it isn't usually the stuff around which soap operas are based. If someone left a spare, unauthorized beta copy of Dynamics CRM at a bar, it's not something Gizmodo would be snapping photos of and TMZ would be scooping interviews about.

Nevertheless, CRM is a huge industry; and while Microsoft has been a big player in that market since its acquisition of Great Plains Software in 2001 and Navision the following year, it has never been the #1 player. PeopleSoft had a very competitive CRM offering for small businesses in the early part of the last decade, then Oracle acquired that company in 2004. Later, Siebel had the lead, and Oracle acquired that company in 2006. (You can see a pattern here.)

Then, as though Calvin "Freakin'" Borel were jockeying it, Salesforce.com has surged forward with a spectacularly successful alternative that is now a prime example of the success of cloud-based Web apps. Microsoft could very well be left behind in this market unless it makes some deals.

Evidently, that's what it was trying to do: Jigsaw is a CRM software producer's Holy Grail. Think of one colossal database of cloud-based, crowd-sourced contacts, assembled through the sheer momentum of tens of thousands of willing contributors. Connect Jigsaw to your CRM product and you have a high-bandwidth gold mine.

Just last month, CRM Magazine's Lauren McKay learned, Jigsaw was preparing to announce a deal with a handful of companies, including Microsoft and Oracle, to extend its cloud-based connectivity to Microsoft Dynamics CRM and Siebel. The result would probably have been a set of branded add-ons that resemble this currently available third-party utility that connects Dynamics with Jigsaw.

Then Salesforce.com purchased Jigsaw outright. Almost immediately, Salesforce began marketing Jigsaw Data Management as its own product -- the biggest link to the broadest cloud database of sales contacts in the world.

The problem with cloud-based products is that they're practically monopolistic by design. Just as there's no sensible business reason for anyone to build "another Wikipedia," it would be considered foolish for anyone to try a "competitive cloud" for even a barely-established product, including Jigsaw.

The objective now for any competitor, including Microsoft, is to try to keep enough of a foot in the door to remain a competitor, before it gets boxed in with the slow horses in the middle. Apparently Microsoft chose to fire a broadside with the weapons at its disposal at the time, which yesterday were comprised of some very old patents on "technologies" such as stacking toolbars together -- methods for which you'd think the rest of the world had already been granted perpetual license by default.

But regardless of whether you buy into the theory that Microsoft has any rights to claim, for instance, the ability to embed a menu in a Web page (patent #5,742,768), it's now an established fact that somebody in Tyler, Texas would buy into it, and it's an academic matter to seat such a person on a jury (even in Washington State where the suit was filed). So even if Microsoft's artillery rounds are made of paper, they can inflict damage.

This lawsuit isn't really about toolbar stacking. It's about making certain a competitor with momentum and motive doesn't lock down the cloud.

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