We'll be the iPod of enterprise software, says Salesforce.com

Salesforce.com has unveiled a marketplace for enterprise applications which it claims could become the iTunes of enterprise software.

The marketplace - dubbed AppExchange - will feature applications such as human resources and project management developed by Salesforce.com and by third party software companies.

The company is hoping this will drive demand for its "on demand" hosted software model, which the applications will run on.

Speaking at the company's Dreamforce customer event in San Francisco, Salesforce.com chairman and CEO Marc Benioff said: "What if there was an eBay of enterprise applications? What if there was an iTunes music store of enterprise applications? We call that the AppExchange."

The exchange currently features 70 applications which can be previewed now, and customers will be able to install applications with the winter 2006 release of Salesforce, expected in the fourth quarter of this year.

Benioff said: "You will see a wide range of applications but they will all run on the Salesforce.com platform that you already have. The iPod is to iTunes as salesforce.com is to the AppExchange."

The company hopes that by providing more applications it can increase the number of subscribers it has beyond its traditional CRM user base.

Benioff added: "I think this is a fundamental piece we needed to accelerate the use of Salesforce.com by non-CRM users inside companies."

Some applications developed by salesforce.com will be free, those offered by third party developers will be charged for.

The move was welcomed by salesforce.com customer Kelli Ritschel-Boehle of Kerry Ingredients: "To be able to take these [applications and components] and apply them to Kerry makes my job easier. It just opens up tons of new opportunities for us," she said.

Bruce Richardson chief research officer at AMR Research was similarly bullish: "We are going to see a lot more pressure on IT costs - we are just not going to continue to write these big cheques and do the big upgrades. CEOs are saying 'where is the value coming from? I want to lower the cost of the back office'. This is the wave of the future."

But David Bradshaw principle analyst at research house Ovum was more cautious.

He told silicon.com: "It's early days. I think it solves a key problem which was that they didn't have any vertical market specific applications. With this they've provided a substantial mechanism for other people to develop these applications for them."