Salesforce.com Grows Up

Salesforce.com is introducing a suite of integration
applications. In doing so, it hopes to remove a major obstacle in its pursuit of
enterprise dollars: integration with installed systems.

ApexConnect is a family of integration services that will allow enterprises
to integrate their complex on-premise systems with on-demand point
applications offered by Salesforce.com.

A key feature of the technology is ConnectOut, an outbound API  that lets
Salesforce.com’s on-demand applications send data to the including middleware systems, message busses and other on-premise software applications in real time.

This means that new customer data, such as a new address of a closed sale,
can be immediately reflected in a company’s enterprise database or ERP
.

Currently, data is synched up between the two systems, usually overnight,
based on a call from the legacy system to the on-demand application.

Ariel Kelman, director of Apex product marketing at Salesforce.com, said
that ConnectOut turns Salesforce.com technology into a more proactive member
of the data integration process. “Those systems no longer have to ask us for critical information,” he told internetnews.com.

Forrester analyst Liz Herbert said the application represents progress for
Salesforce.com on the integration front. “It’s a big step forward in Salesforce.com’s integration capabilities.”

ApexConnect also includes a native connector for Oracle 11i for
synchronizing account information between Salesforce and the Oracle
database. This is quite a turning point for a company that has championed
software-as-a-service (SaaS) while making “death to software” its mantra.

It is also an admission that it will have to work with its sworn enemies,
on-premise software vendors, if it wants to become a truly significant
player in the large enterprise space. “All of our large enterprise customers are dealing with one or multiple back office or legacy systems,” said Kelman.

Herbert noted that Salesforce.com is finally recognizing that enterprise
customers will continue to use their legacy enterprise software
applications. “This whole announcement shows they’re maturing and becoming more
enterprise-ready,” she said.

The application will allow on-demand solutions to gain more relevancy within
an enterprise environment because it effectively turns applications from
Salesforce.com into peers of the enterprise systems. “If you want to be involved with things that are mission critical, you have to do things that support real-time integration,” said Herbert.

Kelman said the applications are intended to address a significant pain
point for enterprise customers. “People are spending a lot of money on integration.”

Indeed, research from Aberdeen Group suggests that almost 40 percent of IT
budgets worldwide are dedicated to software integration efforts.

The ConnectOut feature is currently scheduled to be available in conjunction
with the release of Winter 07. Customers will not be charged extra for this feature.
ConnectOracle will be available in early 2007, for a $12,000 annual fee for
Salesforce Enterprise Edition and Unlimited Edition customers.

The SaaS business model is predicated on the idea that customers will pay
for the service so long as they are satisfied, but that they can also walk away
whenever they like because they aren’t tethered to their sunk costs with an on-premise system.

Kelman said the latest suite of applications recognizes this reality. “If we can keep our customers happy with the recurring revenue model, they’ll keep renewing.”