The service will be another key offering in Microsoft's Live brand initiative that already includes the Windows Live service and Office Live service. And it highlights the software company's aspirations in the on-demand business software arena, which many observers say could be Microsoft's next big business strategy.

"Microsoft CRM Live will provide a software-as-a-service option for deploying our leading CRM solution and will also afford partners new opportunities to deliver their value-added services," said Jeff Raikes, president of Microsoft's Business Division.

Steve Ballmer, Microsoft's chief executive offer, said at a conference this week that the hosted CRM service might be "the single most inevitable announcement in the history of Microsoft."

For the Little Guy

Initially targeted toward small and midsize business (SMBs), the software-as-a-service (SaaS) offering will be operated and managed by Microsoft within its Windows Live data centers and will be designed to give business customers a flexible option as they seek to address the unique CRM needs of their customers.

The on-demand product will be based upon the same code as the on-premise and partner-hosted versions of Dynamics CRM, thereby providing organizations with the ability to choose the deployment option that best suits their needs. Adding to its possible appeal to the SMB set, the Microsoft CRM Live service will also be integrated with Microsoft's other Windows Live services that include e-mail and instant messaging, as well as Office Live business services

The Redmond, Washington, company's decision to target the initial release of Microsoft Dynamics CRM Live at SMBs is a good thing, said Sheryl Kingstone, a Yankee Group analyst. Microsoft's Dynamics CRM on-premise version is nice, she said, but it is not necessarily the best option for smaller businesses because it is still difficult to deploy and maintain.

"For an SMB that does not have an infrastructure ," Kingstone said, "that's where this adds a lot of benefits for the SMB market because they don't have to worry about their infrastructure." (continued...)

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