Salesforce Enters Custom Application Market With Force.com

Crazy that microsoft has just completely missed the boat on all this stuff.

killer domain name, Force.com…that’ll only strengthen their positioning exponentially.

This sounds very good. I will check the site on Monday and see how it can be of use to me.

I agree, this looks great potentially and well, more people will trust it than a startup b/c its salesforce. Looking forward to seeing how it’s been done.

Proprietary web application frameworks, platforms, and API’s don’t make any sense for business customers.

Whatever your needs are as a business, chances are there there is some open source web app that already exists to meet it.

FInd the right open source web app (chances are it’s either in PHP or Java), tweak the code to meet your needs, stick it on a Dell Linux server, and presto — you have your business software.

With cpu cores, memory, and disk capacity where they are today, a $1500 Dell Linux server with an open source web app can satisfy the needs of almost every company. For $5k you can get 16 cores, 32G of ram, and a few TB of redundant disk space. If you need more than that to run a web app behind your firewall for your business, then please don’t forget to wave when your Gulfstream V fly’s over the rest of us.

Bottom line: with a few open source web apps and a commodity Dell server, who needs their business web apps to be hosted by a 3rd party? It doesn’t make sense: (1) you’re entrusting a 3rd party with your data; (2) your data is no longer behind your firewall; (3) you have to spend more money when you add more users; (4) you can’t ditch your service provider, take your web application, and go somewhere else; (5) someone can subpoena the service provider for access to your data — completely bypassing your own legal council; (6) it costs more to use SAAS then it does to stick some open source web app onto a VMware partition on your $2k dell box;

The value of the internet here is in helping businesses to find the right software; _not_ reincarnating some long-dead service bureau from the 1960’s.

To prove this point, I’ve started a website to collect demos of as many open-source web applications as I can. I’m specifically targeting open source web applications intended for businessuse.

And, guess what?

In two weeks I’ve already installed 114 open source web applications. And this is something I do only a few hours every evening. You can pull any of these apps off the web, stick them on a server behind a firewall, and you’re set. No SAAS, no ASP, no proprietary platform, no proprietary API’s, no security worries.

And best of all: open-source web apps are free. See for yourself:

http://www.eser.org/usa/en/vie.....y=business

Sounds like another PR game to distract investors away from their core business.

This is one of the most interesting spaces in enterprise software, and still presents very interesting opportunities. It will be interesting when success stories, such as the Bronx school appear…

This is essentially a rebranding of technology they’ve had available since the Spring; Visualforce, the UI tool, is the main new addition. Since it’s existing technology, there are already some use cases and success stories to look at …

http://www.crn.com/software/201806348

Eser.org … just wanted to say thanks for an excellent tool!

re bmof:

eser.org lets out a sigh of relief…

I was thinking of scraping eser.org and moving onto another project because I couldn’t get anyone to give me any feedback.

I did get a nastygram from someone, though, who was upset that the demo of their website on eser.org failed to validate as proper xhtml. It’s a demo, after all.

Yours is the only positive bit of feedback I’ve got. Thanks!

I guess I’ll keep on adding more open source demos, then. Please let me know if you have any suggestions.

eser

“In fact, this may be sort of game ending for them. Salesforce has its eyes on much bigger fish than those startups.”

This seems in my mind a contradiction. People use DabbleDB because they want a dead simple way to create these apps. Have you used Salesforce? It’s kind of a monstrosity of an application. And at $20 a user per month? This is 2 different ball games, with entirely different players.

“In fact, this may be sort of game ending for them.”

That assumes that everyone who utilizes a platform to create and deliver their SaaS offering will price it high enough (above the $25/month/user that SFDC takes) to make any money. I would venture that this assumption is false for 70% of the potential market.

It also assumes that Salesforce can actually execute on what they claim in their positioning.

Eser,

Look into the TCO for maintaining all that hardware and keeping it free of malware and so on. It’s a nontrivial cost, in terms of dollars AND time.

Nate,

Yes, I have used Salesforce.com. In fact, I’ve been a customer of theirs for two years, attended workshops, seminars and other events.

True compared to DabbleDB, its far more complex, however for businesses that require a platform to build a business upon, Salesforce is second to none.

In terms of complexity, I’m not a programmer yet I was able to create custom database fields, database objects and much more.

Force.com is yet another way I can keep growing my business.

Tim:

Yes, you’re right. To expect companies to own and operate their own servers is like asking individuals to own and operate their own personal computers.

Oh. Ooops.

-ESer.org

I agree with Ed: this sounds great, but we cannot expect to charge our customers anywhere close to $25 per user per month to access our SaaS apps.

However, if it truly is easy to develop workflow applications purely through configuration and they offer bulletproof hosting this could be really big for companies with complicated workflows who don’t want to be in the business of software engineering.

To address the $5k for a dell and open source software idea, it seems awfully naive to me to think that your TCO isn’t going to skyrocket once you factor in disaster recovery, uptime requirements, redundant power and bandwidth, and all of the other economies of scale that companies with infrastructure like salesforce can offer.

Almost all business software today runs on servers owned and operated by the end user.

SAAS is the exception, not the rule.

Open-source or proprietary, it doesn’t really matter — the vast bulk of SMB and enterprise software revenues are generated by support contracts and licensing revenue for on-premise solutions (increasing, support and service is dwarfing licensing revenue).

The total size of the SAAS industry is rounding error. Most of Dell’s revenue comes from selling servers direct to corporations for internal use.

Same goes for Microsoft — most of Microsoft’s revenue and all of its profits come from selling software for on-premise use by enterprise. Whether that be Office on the desktop or Exchange and Sharepoint on the “5k Dell” server.

Dell, Microsoft, Oracle, SAP, Intuit, IBM, Autodesk, BEA, VMware — all of these companies make their bread and butter selling on-premise business solutions.

So, if you want to make a lot of money, the action is in on-premise.

If you want to get on a magazine cover, the action is in SAAS.

-ESer.org

Aaron:

FYI, there are 27,000+ open source web apps on Sourceforge that you can offer as SAAS or use as an on-premise solutions. They’re web apps, so the choice is up to the customer.

The problem with SAAS-only apps is that they do not offer the on-premise solution. So, the customer no longer has the choice — the supplier does.

Imagine you are the customer, which option do you prefer?

Eser,

You are making the assumption that most SMBs have the internal staff to actually deploy on-premise solutions of any kind. Even if they have internal IT people, they can’t really afford to compete for talent with the enterprise so they end up having support and repair people deploy solutions which often lead to broken solutions, lost data and lost productivity.

There are a huge number of small businesses out there that have no technology people in-house and for who SaaS solutions like Quickbooks Online, Salesforce and Hosted Exchange are a godsend.

I think you are greatly discounting the cost of a technology person’s time - most small businesses simply can not afford that time and for them a URL and a monthly fee to an SaaS provider are great ways to build their business.

Larry Velez
Sinu

Ed and Aaron,

Force.com isn’t meant for development companies who already have their own SaaS offering.

It’s meant for businesses who need customized software for their employees, and need it deployed quickly and relatively cheaply. It’s meant for individually tailored, internal applications. The “users” are individual employees. I think shelling out $25/employee/month is pretty reasonable.

Force.com is interesting, but SAP’s A1S is the bigger news story for this week:

http://smoothspan.wordpress.co.....irst-time/

“Game ending”? Perhaps this represents more of a Game Beginning…

Anyone in enterprise SaaS right now knows that ultra-configurable platforms such as Force.com are the envy of the industry for reasons too numerous to list here. Suffice it so say they enable extremely rapid expansion of the core and beyond into adjacent market segments as well as completely new markets – even long-tail micro-markets driven and executed entirely by end-users.

Another new player in this space about to emerge is Rollbase (www.rollbase.com) from former Taleo executives.

Bottom line is that users are being given more and more power to develop their own onDemand apps. This is a mega-trend in enterprise software and all significant players will need a strategy to deal with it. Users are becoming much more empowered to design, build, deploy and even distribute their own custom business apps without even knowing how to program.

Highly configurable do-it-yourself SaaS for business users is the future of software and Force.com is a fantastic example of where things are headed. Just about every enterprise software company, especially those targeting SMBs, will want to be running on their own version of this kind of platform over the next several years in order to compete.

This is by no means a game-ending proposition for any of the companies working in this space. Quite the opposite. Some great strategic acquisitions will emerge here as enterprise software companies figure out how to deal with this phenomenon. Multi-tenant, meta-data-driven, configurable SaaS is difficult stuff to build right. The startups that can and are doing a good job now will command a premium in the near future.

Mike, I think you’ve got this one wrong. Its nice to see that Salesforce recognizes the opportunity. But this hardly signals the end of competition for Salesforce. Rather, it signals the beginning:

http://www.cogblog.com/cogblog.....ill-p.html

In fact, I don’t think Microsoft has missed any of this. Microsoft does now offer their software under the SaaS model through partners like us, although, even though we own our data center, we still have yet to implement one application for a customer. Part of the problem is that the much of the legacy software, such as Microsoft CRM 3.0, is just not built properly for us to easily get it to work properly. I do think however that it’s just a matter time, and we’re looking forward to CRM 4.0, for instance, being released in the 4th quarter of this year, 2007. For the novice who just wants to get something done using applications on the Internet, widgets available on sites like http://www.longjump.com and http://www.coghead.com can be a fast and easy way to go, without all the complication normally associated with building web apps from scratch in dot net, for instance. But you lose all the customization and creativity ability, and this shortcoming I believe will keep shops like iNamics busy for many years to come.