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News from the Cloud: Salesforce.com tweets for customer service

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24th Mar 2009
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A regular round-up of stories about web-based applications from our new sister site, BusinessCloud9.com.

Salesforce.com tweets for customer service

24 Mar Salesforce.com has confirmed a deal with micro-blogging community Twitter, which the CRM vendor hopes will strengthen the relationship between its subscribers and their clients.

Currently in a beta stage of development, the Salesforce CRM for Twitter application is due to fully launch later in the summer, and allows users to analyse ‘Tweets’ for relevant posts to start a conversation and reinforce communication.

"Since its introduction in January, we've seen tremendous momentum and validation from customers, prospects, and partners that the Service Cloud represents the future of customer service," said Salesforce.com CEO Marc Benioff.

"[This] announcement builds on this momentum by enabling companies to join the conversations happening between the more than eight million users on Twitter."

Salesforce.com already has a similar strategy in place with social networking website, Facebook.

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Cloud Banks on the decline of servers in EMEA

17 Mar In his latest opinion piece, BusinessCloud9 contributor Martin Banks has spoken about the 20% drop in server sales across EMEA territories during the last quarter of 2008.

The decrease in demand, originally reported by Gartner, is larger than the drop across the entire global market. According to Banks, the fall is a result of the credit crunch: “fewer and fewer businesses that can get their hands on the credit needed to fund the upgrading and or expansion of a traditional datacentre infrastructure.”

“Even those companies with gold-plated, normally credit worthy bank accounts can’t get any money – and in times such as these it makes even more sense to invest using lines of credit than your own cash. If a business is forced to do that, they will think extra hard about the necessity of the investment.”

Banks adds that the drop is expected to coincide with an increased demand in outsourcing solutions, alongside a possible switch in the types of servers purchased by companies.

* * *
Oracle launches ERP SaaS module

17 Mar Oracle has launched Sourcing On Demand, an Cloud ERP module based on its on-premise E-Business Suite Release 12. The new application caters for tech support and helpdesk functions and integrated applications such as Oracle Publishing.

Cliff Godwin, Oracle Senior Vice President of Application Development commented: “We think that the time is right for a solution that can drive big cost reductions without requiring extensive capital expenditures or additional IT resources”

Oracle’s move into hosted ERP modules follows claims by ICG Commerce that 2009 will see a surge in procurement outsourcing.

* * *

Microsoft increases Cloud presence

11 Mar Microsoft has announced the international availability of Business Productivity Online Suite (BPOS), a package of online products based on Microsoft Exchange, SharePoint, Office Communications Online, and Office Live Meeting.

A free trial for up to 20 employees within a company is currently running through to April, with subscription fees of £10.04 per user, per month, beginning thereafter.

The launch of Business Productivity Online Suite expands Microsoft’s presence on the Cloud, and comes as the Corporation continues to develop Azure, a Cloud system aimed at providing a range of web-based services. Microsoft’s goal is to integrate both BPOS and Azure with its Dynamics suite of business applications.

UK Dynamics product marketing director Gary Turner told AccountingWEB, "Increasingly you'll see a number of initiatives such as Dynamics CRM Online and other online stuff rolling out that share the same denominator - an online Microsoft data centre...will be a viable alternative to buying business services."

* * *

SaaS and the recession

4 Mar Warren Wilson of research house Ovum sees encouraging signs for Cloud computing from the recent financial figures released by NetSuite and Salesforce.com.

"NetSuite's results suggest that a grim economy may favour the SaaS model, with its rapid, low-cost adoption, over on-premise software, with its high license fees and long deployments," he noted.

"Only a handful of vendors have ventured into SaaS ERP, and so far none has achieved profitability. If NetSuite can post consistent profits, it could be the first to demonstrate that SaaS is viable not just for CRM but for mission-critical ERP, the system of record at the core of the business. That would be a strong indication that customers are growing comfortable with both the reliability and the security of SaaS - two persistent criticisms of this delivery model," Wilson continued

"A consistently profitable NetSuite would place more pressure on vendors of conventional ERP solutions to offer on-demand versions of their own. So far SaaS solutions have generated profit margins much lower than those of traditional packaged software. If that remains true, ERP vendors that have long relied on high-margin, on-premise solutions may not be able to compete with pure-play SaaS vendors without significantly reducing prices and cannibalising their own core markets.”

Salesforce.com's results also compare favourably with on premise rivals. "Oracle and Microsoft posted declines in net income in their most recent quarters - Oracle down 1% to $1.3 billion, Microsoft down 11% to $4.17 billion. SAP's quarterly net income was up 13% to €850 million, but down 2% for the full year, to €1.9 billion," Wilson said.

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