With AppExchange, customers can access a broad array of applications from partners, developers and other Salesforce users, potentially creating new software for existing Salesforce deployments.

The AppExchange Web site currently lists 70 applications available for preview and evaluation. Installations via the site will be offered by the end of the year. There is no charge for the service, although applications from partners typically will require a fee.

Share the Wealth

The initial set of available applications extends Salesforce.com's on-demand CRM portfolio and covers areas such as finance, electronic signatures, document management, project management, credit, collections, mobile-workforce management, data cleansing, professional-services management and human resources.

"The Internet is all about letting people share technology," said Tien Tzuo, a product marketing executive with Salesforce. "Our customers want on-demand access, and we have established a leadership position in that area. This goes well beyond exchanges in the developer community to include large- and small-business models."

Currently, visitors to the Salesforce.com Web site can browse available applications by category. Each listing includes a description and a ratings system similar to those used by online merchants like eBay and Amazon.com. Users also can test each application online.

The Get It Now feature, to be rolled out in the coming months, will make the selected application available within a subscriber's individual Salesforce.com account. Once installed, AppExchange applications will reside alongside existing on-demand applications and may be customized.

"We have a very strong platform, and we want to open it for others to access, benefiting a broader range of our customers," said Tzuo.

Unique Concept

AMR Research analyst Rob Bois called AppExchange a unique concept that should enable Salesforce to expand its developer environment and to encourage third-party participants to build applications using the company's platform.

"This creates a community of applications and application components," he said. "At the same time, it broadens the company's horizons as they can hold onto their core CRM technology while creating industry- or geographic-specific applications."

As such, the sharing service should help drive sales of the company's products by encouraging more businesses to buy its platform and participate.

Open-Source Model

Yankee Group analyst Sheryl Kingstone likened AppExchange to the growing open-source software model. "They are building an ecosystem for applications using their customer base," she said. "It could be particularly attractive to vertical customers who will be able to write one application and distribute it widely without having to start over with each distribution."

Bois pointed out that the new service was unveiled at the same time Oracle announced its purchase of Siebel in a $5.85 billion deal, a move that will increase competition for Salesforce.

"Oracle now has Siebel's on-demand CRM technology, but the real battle for Salesforce is against Microsoft , which has created an on-demand CRM product that will be part of Microsoft's next product release," he said.