Google bundles Salesforce.com CRM with its online apps

Today, Google helped Salesforce.com pour more fuel onto the fire of its already heated rivalry with Microsoft's Dynamics CRM Online, a software-as-a-service product rebranded by Microsoft late last month.

Specifically, starting today, Salesforce.com's CRM Online service is tightly integrated with Google's online word processing, spreadsheet, and e-mail applications suite.

During the last days of March, Microsoft's own hosted CRM product, Dynamics CRM Live, took on the new name of Dynamics CRM Online, in a move to expand the target market of the Microsoft-hosted service from SMBs to the enterprise space.

Microsoft is being more careful now to distinguish "Live" as its consumer online brand, with "Online" as its more professional online brand. It also sells licenses for packaged CRM software, and its CRM offerings are already integrated with Microsoft Office.

Google and Salesforce.com have actually been collaborating to thwart Microsoft's online CRM efforts for some time now. Salesforce.com has been one of the few large companies publicly committed to integration with Google Apps since its introduction in February 2007.

In June of that year, the two Microsoft rivals started integrating Google's AdWords advertising technology into Salesforce.com. Then, in November, Salesforce signed on for OpenSocial, a Google-spearheaded industry group which is working on applications standards for social networks.

Clearly, Google and Salesforce view Microsoft as a mutual threat. In a search on Google earlier today, using the keywords "Microsoft CRM Live," BetaNews turned up a sponsored link dubbed "Microsoft vs. Salesforce." A click on the sponsored link brought us to an ad on the Salesforce.com Web site for a CRM white paper.

"Independent research comparing companies using on-demand CRM to those using on-premises CRM show better overall performance for the on-demand customers," according to an online blurb on the Salesforce site.

While fending off competition from Google, Salesforce, and a variety of other sources, Microsoft has undergone integration pains over the past few years in formulating its own CRM/ERP line-up, forged out of acquisitions of myriad third-party vendors, including Axapta, Navision, Great Plains Software, and Solomon.

But in a conference call last December, a Microsoft official indicated that sales of its Dynamics line-up have been much stronger on the CRM than on the ERP side of the house.

Jeff Raikes, who then headed Microsoft's Business Division, credited Microsoft's Dynamics CRM for pushing Microsoft's Business Solutions over the $1 billion mark in revenue for fiscal year 2007. This accomplishment was "fueled by greater than 50 percent growth with Dynamics CRM. In fact, we sold more than 85,000 seats of Dynamics CRM in the last quarter," according to Raikes, who in January announced his impending retirement from Microsoft.

"85,000," Raikes repeated during the call in December. "That's about the same as Salesforce.com," Outside of Microsoft's SAAS, Raikes claimed 11,000 customers and 475,000 end users for Microsoft's on-premise Dynamics CRM product.

Raikes remained rather mute, though, about Microsoft's ERP offerings, except to say that, "We're bringing updated versions of our ERP products, Dynamics AX and NAV, to market."

Microsoft Dynamics NAV staff have admitted in recent blog entries to user complaints about changes made in the 5.0 edition Dynamics NAV accounting software, promising to provide software fixes and better documentation in the future.

NAV does not include CRM capabilities, although it can be used in conjunction with Microsoft CRM Professional Server.

Aside from Dynamics CRM, AX, and NAV, other components of Microsoft's current Dynamics family include the Microsoft Dynamics Retail Management System (RMS).