'Microsoft, you're too slow,' says NetSuite CEO

Zach Nelson is unfazed by the threat posed by Microsoft shaping up to compete in the on-demand CRM sector.

The CEO of NetSuite, Zach Nelson, has dismissed the threat posed by Microsoft shaping up to compete in the on-demand CRM sector, while saying competitors Salesforce.com and RightNow remain friendly rivals until the old guard - namely Siebel - has been overthrown.

Nelson accepts that those immediate competitors also touting on-demand models - Salesforce.com and RightNow - have made the right bet and believes the market will be large enough to support all three.

Speaking exclusively to silicon.com, Nelson said: "NetSuite, RightNow, Salesforce.com - that's where all the new contract growth is. Siebel's growth is just maintenance."

However, despite such acclaimed growth, Nelson said there won't be an influx of vendors into the market because any other player is already too far behind the curve.

And while money talks in technology, even the richest company can't bend time.

"Microsoft has the money but it doesn't have the time. This isn't something that you can just throw developers at."

And in a 'build, partner or buy' environment Nelson believes Microsoft only has one option.

"Even with all their money they're going to find they still have to build," said Nelson. "They aren't going to be able to buy any of us."

"I certainly don't think we'd get sold to Microsoft. I could ask our owner but I don't think he'd go for it," said Nelson of major shareholder and renowned Microsoft agitator Larry Ellison, who still holds more than 50 per cent of NetSuite stock.

He believes his closest rivals would be similarly unlikely to accept Microsoft's dollar, especially with a strong ex-Oracle presence within Salesforce.com as well.

"And how long is it going to take Microsoft to build anything? What are we talking - 2012? Where are we going to be in 2012?" said Nelson. "Hopefully I'll be retired."

The only major CRM vendor thought to be looking for a buyer is Siebel but Nelson believes few firms would consider such a gamble on a company he sees as "a dead man walking".

"Siebel have done a lot of things right. They were very vertically focused and knew the markets they were selling to," said Nelson, perhaps deliberately slipping into the past-tense. "The problem wasn't with their knowledge, the problem was with their product. They built a giant hairball of a product."

He also had few kind words for SAP.

"I've heard a lot of mumblings about a product coming out of SAP but I've no idea what it is. I think it could just be a case of them putting lipstick on the pig."

Will Sturgeon of Silicon.com reported from London.

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