Michael Kahn

SAN FRANCISCO: Microsoft Corp. on Monday introduced the long-awaited update to its sales and marketing business software that the company said would help it push into the market for large enterprises now dominated by Oracle and SAP.

Microsoft Dynamics CRM 3.0 contains new updates of features that help companies track and manage sales forces and customer relationships. The software is typically known as customer relationship management, or CRM software.

The Microsoft product also for the first time includes functions to help businesses carry out marketing campaigns, the world's biggest software maker said.

Microsoft CRM debuted in 2003 and now has more than 5,500 customers in an estimated $11 billion market for the software that helps companies manage sales forces and marketing campaigns. SAP AG of Germany and Siebel Systems, which has agreed to be acquired by Oracle Corp., lead the market for customer relationship management software.

"Microsoft Dynamics as a product line is not limiting itself to small and mid-sized businesses," said Brad Wilson, general manager for Microsoft Dynamics. "Clearly CRM is an example of where we are going after large business in a very broad manner."

The updated product release comes as the Redmond, Washington-based company seeks to build on its business applications offerings that also include financial and supply chain management software.

Rob Bois, an analyst at AMR Research, said the new Microsoft CRM product challenges SAP and Oracle and directly threatens upstart SalesForce.com Inc., which has a strong presence among small and medium-sized companies.

"It really hits that market most effectively," Bois said. "Microsoft will also be trying to move upstream to larger enterprises."

Microsoft will sell the updated CRM software either on CDs or customers can receive it via the Web through partners, the company said.

It also hopes to win business with a product that works with the Outlook desktop office program used by many companies, Microsoft's Wilson said.

The new CRM product is part of the company's "Microsoft Dynamics" brand software, which the company introduced in September as its latest line of business applications.

Microsoft said the price of the new CRM product will depend on the license program a customer chooses. Customers can either buy it on a subscription basis or license the software.

The Professional Edition aimed at large businesses will cost between $622 and $880 per user and $1,244 and $1,761 per server. The Small Business Edition limited to 75 users is priced between $440 and $499 per user and from $528 to $599 per server.