Salesforce.com is planning to install server farms in Europe and Asia to underpin its runaway growth.  The web-based applications software group is continuing to gnaw away at the heart of the traditional software business with a business model which will seem a touch familiar to those with long memories.  It operates, at present, only customer relationship management, which it provides as a service to more than 550,000 customers daily.  Customers need neither hardware nor software. They  despatch CRM queries over the web: Salesforce sends back the processed results.   Yes, it’s basically a computer bureau service brought up to date with the web supplanting those fleets of vans which used to scuttle between customers and bureaux carrying cans of magnetic tape. 

The dramatic growth of Salesforce - it’s worth $5bn right now - confirms, for me at any rate, that a subtle blend of cost and competition are driving a cycle in which  applications move from the centre of the network to the edge and back again.  Traditional bureaux saw applications firmly at the centre. Fat clients saw them move to the edge. With client-server computing, the cycle turned again and Salesforce seems to be completing the process. 

How long will it hold sway?  Who knows.  My bet, however, is that a combination of ubiquitous computing power at near zero cost and super simple software tools which will encourage the creation of competitive edge software will spin the wheel one more time.

- Alan Cane, London

November 29th, 2006 in Software | Permalink