Just noticed that Microsoft CRM Online is now officially available. Not sure how personally invested I'll get in learning it. I responded to several Beta trial invitations, but never received an invite (and we're a Microsoft partner?!?).

There is a 30 day trial that you can apply for.

Kudos to Microsoft for changing the name from "Live" CRM to simply "CRM Online" (As Simon Cowell might say "The whole Live brand just seems a bit too cabaret-ish for business software applications" ).

If The Big Switch can be said to represent the centralization of computing resources, then Microsoft's Live Mesh may signal the path towards the big switch back to a decentralized model (albeit with some centrally hosted Microsoft infrastructure).

Some ideas for using Mesh with our CEM platform and Salesforce:

• Real-time notifications when Leads/Contacts enter your website
• Sync and offline access to CRM data and documents across several devices
• Rich development of email campaigns and web page content
• Social networking with employees, partners, and customers

In classic Sun Tzu fashion, Marc Benioff embraces competitor SAP by stating:

"I want to figure out how to get SAP to build on our platform. SAP needs to write its new apps on our platform."

For Microsoft's part, SAP integration came naturally since SAP is used in-house to run the business. The two giants have silently agreed on the mutual win-win opportunity of using Office tools (Excel and Word) to access SAP apps.

Unfortunately, integrated Microsoft-SAP applications have an air of being written for Microsoft by Microsoft.

Is it likely that SAP will develop their new apps on Force.com? Probably not.

Is it likely that SAP customers will (and already do) develop Force.com apps integrated with SAP? Definitely, yes.

In contrast to the "destroy the enemy" strategy employed against Seibel, I think it is a wise path for Salesforce to acknowledge that on-premise enterprise software will be around for years to come and that the "art" of victory against established ERP players will be one that embraces the revenue streams of existing infrastructure and provides a migration path to SaaS/PaaS alternatives.

Nicholas Carr advises his readers to put their ears to the ground as Microsoft prepares to announce further details about their "computing in the cloud" strategy.

Some facts and observations I've made:

• Ray Ozzie, Bill Gates heir apparent, is a smart guy and has been under the radar for over 2 years working on something (presumably).
• Microsoft has been building, acquiring, and deploying datacenters at an alarming rate. But the utilization math doesn't quite add up. There's a lot of untapped, unused computing power owned by Microsoft.
• In my recent discussions with various Microsoft employees, there is a much more open and humble acknowledgment that they are in the canonical Innovators Dilemma and must branch out into hosted services while still retaining the Windows OS/Office cash cow.

It will be interesting to see how similar this new strategy is to Microsoft's Hailstorm platform, which was announced 7 years ago. Ironically enough, the Architect of Hailstorm, Mark Lukovsky, left Microsoft and joined Google to ultimately implement and fulfill this vision.

Microsoft clearly has the Engineering resources and talent to compete with Google, Yahoo!, and Salesforce.com in Internet delivered services. It makes one wonder what exactly is preventing them from tapping their true potential? 

Per Nicholas' advice, my ear is firmly planted to the ground...

On-Demand software has revolutionized how enterprise software is deployed. Declarative customization provides line of business managers with an unprecedented number of options from which to "declare" how a CRM record is defined or presented in a page layout. But let's face it... at some point, all enterprise software solutions require some level of programmatic customization. Enterprise software vendors simply cannot anticipate each and every business requirement.

Salesforce customers, having reached the limits of declarative customization, now have domain specific programming languages such as Visual Force and Apex to programmatically customize their CRM system.

Content Management Systems (CMS) and Enterprise Portals already have a strong legacy of supporting programmatic customization, but achieved this flexibility through integration with existing development environments and the modification of physical files and templates.

Many CMS's have attempted to offer purely browser-based declarative customization environments, such as Wiki's and Blogs, but failed to meet the demands of creative and marketing professionals, which require detailed control over the presentation and branding of web pages and emails.

It's time for a new scripting language that meets the unique demands of Customer Experience Management (CEM). It's time to offer an optimal balance between declarative and programmatic configuration options. It's time to recognize that there is a new generation of workers entering the workforce that embrace Domain Specific Languages (see Fowler: DSL) and expect programming the web to be as easy as programming their iPod, Tivo, or DVR. It's time for a language like "Dialogue".

"Dialogue" is a new scripting language designed specifically for helping organizations to interact with their customers and partners online using concepts familiar to both the web (HTML, CSS, Javascript) and CRM (Lead, Contact, Opportunity, Case records).

The key tenants of Dialogue include:

Creativity / User Interface: Dialogue is primarily a presentation language that resembles HTML and is used in the creation of dynamic web pages, landing pages, and emails. Graphic designers and web developers have control over each pixel in the presentation of Dialogue scripts.

Business User Support: Business users can easily modify Dialogue scripts to present information most relevant to customers and partners. Changes can be made to Dialogue scripts without the assistance of a web programmer.

Multiple Development Environment Support: Dialogue scripts can be managed using either a web browser or rich client. Todays content management professionals are accustomed to working with tools such as Dreamweaver and Expression. Dialogue plug-Ins for web development environments (starting with Expression) will be developed to enable the remote persistence and management of Dialogue scripts using a locally installed rich client. But the flexibility of storing and managing content entirely on the web will remain the primary focus.

CRM-Driven: Dialogue scripts provide direct access to CRM records and data for maximum personalization.

Agile: Dialogue scripts support an agile methodology that allows organizations to go from concept to deployment within a matter of hours or days. Campaigns can be modified on the fly and no longer suffer from the constraints of "waterfall" project management methodologies where considerable upfront planning is required to reduce the anticipated cost of change.

The Dialogue scripting language will help organizations transition from static, brochureware web designs common in the 90's, to highly interactive and personalized online experiences. It is our goal that all Salesforce customers will unlock the capabilities of their CRM system to delivering these rich online experiences. Dialogue is the final link in enabling this level of interaction.

Our portal and eMarketing Developers spend a considerable amount of time translating customer requirements into working features, which requires the use of highly abstract tools, languages, and technologies. To this end, we've standardized on the use of Microsoft tools and services, commonly referred to as ".NET".

We were fortunate enough to spend the afternoon with Scott Hanselman, Development Community Liaison for Microsoft. Scott is fairly well known in the .NET development community. In fact, if you've ever Googled any search term remotely related to .NET, chances are you've most likely come across his blog or PodCasts (prompting some to wonder if he ever sleeps ).

I was really impressed with what Scott presented. Not only with the wealth of new features and services in .NET 3.0 and 3.5, but the myriad 3rd party and open source tools available that can be uniquely combined to create an extremely powerful, test-driven development environment.

The development tools space has become very stable and commoditized. Much like the component-based Eclipse development environment used by Salesforce.com, Visual Studio.NET is so extensible and customizable that the only limits are the Developers imagination. Scott maintains a great list of indispensable tools and utilities.

The highlight of the session? Probably LOL CODE. An actual programming language based on the LOL CATS concept. Who knows... maybe next generation CRM applications will be programmed in languages that look like this?

News is out that Microsoft is investing $240 Million in Facebook for 1.6% in equity, putting a $15B valuation on Facebook. What?! You read correctly. A 1.6% stake for $240M.

Hard to justify by any means, but it reminds me of when the Yankees signed Alex Rodriguez to a 10 year $252M contract. I was among the many Seattle Mariners fans who paid top dollar to see this new Yankee's star play, which in itself probably justified the valuation because the Yankees were selling out just about every game in every town.

A self-fulfilling prophecy perhaps? I would expect Facebook's 50M user community to easily double within the next year as people tune in to see what the commotion is all about.

The Microsoft CRM Live buzz appears to have died down. We started looking at the opportunity to implement an "i-Dialogue for CRM Live" solution back in March, but nothing ever materialized that we could get our hands on.

This delay violates the on-demand credo of "Release early and often". I had really hoped Microsoft would earn their operational stripes by jumping into the market with "good enough" and letting customer and partner feedback dictate the evolution of CRM Live. Now we're left to assume that the project is in a state of "analysis paralysis" with Program Managers bickering with Engineers over how to "get it perfect" for launch (it'll never be "perfect" guys... don't take it personally. It was ready last year).

Dynamics CRM 3.0 is a great CRM solution (see my test drive last year), but I'm beginning to have serious doubts about Microsoft's ability to enter the market behind Salesforce.com. This is not like throwing an XBox up against a PlayStation. There's no Halo 3 equivalent killer app that can make CRM Live an overnight success (or within 5 years) that I can see. But there is one killer infrastructure angle up Microsoft's sleeve that could change how CRM is deployed and hosted in the future.

If Microsoft truly wants to be a CRM contender then, in my opinion, they need to leap frog the whole multi-tenant architecture discussion and focus exclusively on next generation CRM virtualization, which is the ability to pre-configure an entire Windows CRM server with all dependencies, and allow this "image" to be hosted by any 3rd party.

Leverage would then fall back to the consumer who could "shop around" for virtualization hosts and take their entire CRM/Active Directory/SQL Server VM image with them anywhere they want to go. I suppose that would give new meaning to "Where do you want to go today?"

Microsoft's announcement that MS CRM Live will be priced at $45 per user has raised some responses from the competition.

You can buy the on-premise version of MS CRM today for about $1,500, which includes a perpetual use license. Spread that cost out over 3 years and you get $41.66 per month. Add a few bucks for hosting and $45 sounds about right.

I have a feeling that there will be more parity between an organization's size and the number of seats licensed at this price point.

For example, an organization with 20 employees may only subscribe to 5 Salesforce seats at $75 per month and limit access to those in Sales or Support. Whereas the same organization may be more inclined to purchase 10-15 seats at $45 per month.

While Salesforce clearly has more cross functional value than MS CRM, customers often do not want to pay for unused functionality in the early stages of adopting CRM when centralized contact management is the primary goal.

Wow. I anticipated some level of technical difficulty when integrating with Microsoft CRM (support for which we recently announced) but didn't anticipate any significant legal issues. Apparently, Microsoft CRM 3.0 requires the licensing of something called an External Connector for each web server integrated with Microsoft CRM and I'm not the first to be confused about the applicability of this license in a Web-to-Lead, customer portal, or partner portal context.

The connector is about $15,000 USD, and amortized over 5 years comes to $250 per month. I *really* hope Microsoft CRM Live modifies this license to be more inline with current subscription-based expectations. Just getting SMB customers to try on-demand, loss leading features for $95 per month can be difficult enough. Don't make partners start that far in the red. They'll never adopt the platform.

Will the partner/ISV absorb the cost of externally integrating with MS CRM Live? Will the end customer? Answers to these questions are still not clear as we enter the 11th hour prior to Microsoft launching their on-demand CRM Live solution.

My suggestions:
* Implement a variable, value-based external integration licensing model. Not a "one size fits all" license.
* It still remains to be seen if Salesforce.com's 10% referral program is the right model to attract and retain partners, but it is more closely tied to value on a per customer basis.
* License the XML web service gateway separately from the core CRM application per external end-point. Implement a SOA friendly model that encourages Microsoft CRM customers to purchase additional web service connectors for multiple end-points at $750 per year (This is where I think Salesforce has missed a tremendous opportunity to license their API to Professional Edition customers and is the most griped about integration topic).