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A Dynamic Lift From AX For Microsoft?

Microsoft wants to prove that it can still walk the talk.

Today, it is introducing Dynamics AX 4.0, the re-baptized and more muscular version of its Axapta ERP product, in the hopes of showing strong growth in the large enterprise market.

The Microsoft Business Solutions (MBS) division, of which Dynamics AX is a part, is the second-smallest in the software giant's empire. But that also gives it a lot of room to grow, and Microsoft nurtures high hopes for this segment.

"It's a lot easier to grow market share in business solutions than in areas where we already have 90 percent of the market," said Mark Jensen, general manager for Dynamics AX.

Jensen told internetnews.com that Microsoft will release the results of a benchmarking study on July 10 that will show dramatic improvements in performance and reliability, compared with older versions of AX.

"The numbers will show mid-double-digit improvements in raw performance and scalability that we have been able to accomplish even as we added more unicoding and other enhancements to get up to parity and beyond.

"We've got a more feature-rich product running faster than the older, less feature-rich version."

Jensen said that, with this product, Microsoft is intent on demonstrating to Wall Street that it is more than just a value play by demonstrating strong growth.

"This push upwards into the enterprise market certainly helps with that on a revenue perspective," he said.

Of course, any growth is predicated on the success of AX, and that is not a given.

Joe Wilcox, an analyst who follows Microsoft for JupiterResearch, noted that while Microsoft has high hopes for MBS, he is not convinced that those hopes will be realized.

"Microsoft believes the business division has products with huge potential," he said. "But so far there's no evidence that that's true."

Moreover, Microsoft's product roadmap stumped customers and analysts alike out of the gate, and its marketing message was muddled.

Accusing Microsoft of having shown a lack of clarity is "a fair criticism," Jensen admitted.

But that is in the past, he said, and the company is determined to improve its message to the market.

The AX 4.0 release is the first step in that clarification. The most important aspect of this release, said Jensen, is that AX now "looks and feels like Microsoft."

Indeed, the user interface "looks like the current version of Office," and users can interact with business intelligence solutions through Outlook, Excel and Word applications.

Jensen also said that AX 4.0 is built around an application integration framework based on the principles of service-oriented architecture (SOA) .

Developers working for partners in vertical niches, for instance, can construct Web services that can make native calls into the Dynamics AX class library.

"Previously, they had to write within AX itself; now they can write in any language, including any non-Microsoft technology programs," said Jensen.

Joshua Greenbaum, principal analyst for Enterprise Application Consulting, told internetnews.com that supporting channel partners in niche markets is critical to the success of the product.

"They need to make inroads into vertical industries in order to be competitive," he said.

AX 4.0 also features enriched financials and more country-by-country Versions, so channel partners don't have to spend time translating languages and customizing for local accounting practices and regulations.

According to Jensen, Microsoft will continue to clarify its MBS message to the market with future releases. The next release of AX will integrate strengths from other Dynamics products, while continuing to refine the Office look and feel.

But Wilcox disputed the notion that customers will feel more at home with AX because of the Office interface.

It turns out, he said, that when JupiterResearch asked business users how they are used to accessing back-end information, the browser was ahead by leaps and bounds.

"Office is far, far behind the browser," said Wilcox.