For example, Microsoft says one day that customers in our industry should upgrade from Microsoft CRM 1.2 to Microsoft CRM 3.0 (they lost 2.0 on the way), and, unfortunately, the two versions are not compatible with each other --- customizations will not upgrade, they have different user interfaces, and they require lots of different Microsoft software. It?s an old Microsoft game that ends in failure for customers, but generates their mafiaesque upgrade revenues.

The next day, Microsoft has a new version called "Live." It's the new on demand offering that will not be compatible with the current product line. So, perhaps they should rename their entire Microsoft software product line, Microsoft Dead. It's the analog to Microsoft Live, the new on demand offering that does even exist.

What is going on? This is a time of seismic shifts in our industry. The internet is disintermediating the status quo, and old models of software cost and complexity are being replaced with new models of affordability and ease of use.

Last month, our number one competitor surrendered, and decided to take its place beside several former competitors at software's Shady Pines Rest Home, also known as Oracle. It was a merciful outcome for shareholders, but a time of con"fusion" for customers.

The software industry is going through a transformation that is unlike anything it has seen in two decades, and the emergence of the PC itself.

This transformation goes by many names: On-Demand, Web 2.0, Software as a Service. But they all point to the same conclusion: The era of the traditional software "load, update, and upgrade" business and technology model is over. It is time for "The Business Web."

New Internet-based companies are showing how services will replace software for both consumers and corporations. Sand Hill Road venture capitalists are no longer funding software companies; they are only funding service providers.

Exciting new companies have emerged like salesforce.com and Google who have real businesses that can challenge and win against the old guard companies, and are. Customers love these new services, and are finding tremendous success as never before.

A new range of start-ups are showing how this is just the beginning of the business web --- that there are new technologies coming to replace traditional word processing, spreadsheets, and other staples of business with Internet services. Companies like Writely, Numsum, Zimbra, and Goffice are breaking Microsoft's hypnotic trance that the Microsoft Office, and its myriad of clients and servers we are installing today, it is simply a dinosaur.

Would these companies have existed ten years ago? Five years ago? Probably not. But, new widely-accepted technology standards, like Ajax and others, make them possible, and consumers and businesses impatient with the current pace of change at Microsoft make them necessary.

Just as mainframe companies struggled for relevance in the client-server era, Microsoft finds itself in a worse position today facing not just the obsolescence of a technology model, but a business model as well. They have no position today in the business web, for example.

Now is our time to demonstrate the next level. New technologies like AppExchange, Mirrorforce, and our Winter 06 release further demonstrate the next generation of the business web, and we will all continue to lead this important movement.

Aloha,
Marc

Source: Stephen Naventi, Outcast Communications.