Who will Salesforce.com buy next?

Now that on-demand poster child Salesforce.com has grown up a little by scoring its first acquisition, it's only natural to begin speculating who's going to be next on its shopping list. But first let's pause to analyse the Sendia deal in a little more detail.

Notice, for example, that Sendia has become part of AppExchange, rather than an add-on to the CRM product line.Expect the next acquisition maybe even before mid-year Does that not strike you as somewhat odd? AppExchange represents a tiny proportion of Salesforce.com's overall revenues. The company went seven years without making a single acquisition to bolster its flagship CRM product. Then within weeks of bringing out its second product line — a development platform to serve the unproven and untested market for cobbling together custom-built and third-party on-demand applications — it goes and spends $15 million on expanding its capabilities.

This expresses huge confidence in the upside potential for AppExchange — either that or reckless enthusiasm — and reinforces the message that AppExchange is Salesforce.com's strategic product going forward.

Now look at Sendia for a moment. This looks like very impressive technology, but it has to be said the company has a pretty poor sales track record. Founded in 2002, it pitched its wireless SFA product into the enterprise sales force automation market two years later, striking alliances not only with Salesforce.com but also with Siebel and Oracle's PeopleSoft unit. As of yesterday, it had acquired no customers from those other alliances, and had signed up just 79 from Salesforce.com's 20,000-plus customer base.

The big question in my mind yesterday was, why buy the company when Sendia was already effectively acting as an exclusive Salesforce.com partner? I think the answer must be that Sendia was an all-too-typical tech startup, with great engineering strengths but not much magic in the sales and marketing department. That's an area where Salesforce, of course, has no shortage of talent, and perhaps started to feel frustrated by Sendia's relative lack of success in getting noticed and closing deals.

So here are the conclusions we can draw. Salesforce.com bought Sendia for the following combination of reasons:

• Early adoption statistics suggest that AppExchange is a strategic product offering for the company
• Wireless is a strategic capability within AppExchange
• Too strategic, therefore, to leave in the hands of an underperforming (and perhaps cash-strapped) partner

What then does that set of assumptions tell us about Salesforce.com's future acquisition strategy? Bearing in mind, of course, that this is just a set of assumptions and that my analysis might be wrong. If I'm right, though, I think it tells us that Salesforce.com will move whenever it sees a strategic reason to protect and/or ramp up a capability being offered within the AppExchange ecosystem.

I think there are a couple of capabilities that look strategic enough for Salesforce.com to want to act sooner rather than later (federated identity may be another, but for guidance there I defer to my new colleagues over on the Digital ID World blog). Expect to see some M&A action in these areas within the next 12-18 months.

The first is rich client capability — as an enabler of user-driven application customization, which is a key area of need. The toolkits are not good enough yet to deliver the kind of browser experience that AppExchange applications must have to stay on the leading edge by this time next year. That puts companies like DreamFactory and Nsite in the frame for acquisition — but it's not a foregone conclusion. Moving too early could be a mistake in a space where the dominant trends are still very hard to call.

The other is back-end integration to customers' existing on-premises applications and data. I've already mentioned how this is a big issue for Salesforce.com along with other on-demand vendors, and eWeek last week reported that the company is already investing in an integration module for SAP. Partners that may be in the frame there include Above All Software, Cast Iron Systems, Pervasive and one or two others. This is where I expect to see the next acquisition, maybe even before mid-year.