Microsoft to deliver its cloud-hosted CRM 5 first, software later

Microsoft is planning to roll out the cloud-hosted version of its Dynamics CRM 5 product ahead of its on-premises software version of that product. In fact, there's talk the software version won't be available until 2011, instead of 2010, as promised.

One regular criticism of Microsoft's cloud-hosted offerings is the online/hosted versions often lag by months their on-premise software counterparts. And even when the delivery gap isn't so onerous, the online versions may be missing for months many of the features of the on-premises ones.

It seems Microsoft is going to break that pattern with Dynamics CRM 5, the next release of its CRM product.

Last month, Microsoft officials said both the on-premises and the online versions of CRM 5 would debut before the end of calendar 2010. But they didn't delve into which of the two releases would roll out first.

Via a tweet on May 5 from Directions on Microsoft analyst Rob Helm, I learned that Microsoft is promising to deliver the CRM 5 Online service release before it delivers the CRM 5 software.

Even though both products are built on the same code base, CRM 5 Online is still on track to ship late this year, but the on-premises version won't be available until 2011, Helm said.

I asked a Microsoft spokesperson for verification. This is all the company is willing to say: “CRM5 will be available late 2010 beginning with Online in 32 markets and 41 languages, followed by the on-premises version.”

(In other words, no comment on when the on-premises version will make it to customers.)

"Exchange Server 2010 got its out-of-town tryout as a service -- the Live@edu e-mail service for educational institutions was apparently running that version before it was available to customers. However, this will be the first time I'm aware of that Microsoft has started running a version of its software in its commercial hosted services before it was ready to ship that version to customers," Helm said.

"It's an interesting step forward for Microsoft's cloud strategy, as well as a sign how of how seriously Microsoft takes Salesforce.com," he added.

I've been hearing that Microsoft is encouraging its partners to lead with its Online wares (CRM Online, SharePoint Online, Office Communications Online, the Business Productivity Online Suite, etc.), especially when pitching to small/mid-size business (SMB) customers. I wonder whether, going forward, we'll see the Online versions of all of Microsoft's growing stable of cloud wares be first out of the gate, instead of the other way around....

Editorial standards