Siebel launches hosted service in UK

21 April 2004 Siebel Systems, the customer relationship management (CRM) software supplier, responded to growing competition in the outsourced CRM market by revealing that it is poised to launch a hosted service in the UK and across much of Europe.


Siebel OnDemand, which has been available in the US since January 2004, has been localised to add currency conversions and European languages and will be available commercially from the beginning of May 2004. The service is priced at €70 per user per month.

The launch of an ‘on-demand’ version of Siebel is the culmination of an 18-month development effort with IBM, executives said. There will be one version of the CRM application, hosted at an IBM datacentre in Colorado.

Businesses already running Siebel that choose to sign up to the OnDemand service will install a hosted integration server in order to share data between their existing applications and the IBM-hosted database.

Customers will have to pay an additional charge for the integration server. The server price will be revealed at a press conference on 7 May. Company sources say they are minded to set it around €20-€30 per seat.

Tom Siebel, the software company’s founder and CEO, cited “growing demand for outsourced deployments” as one of the key trends in the CRM market.

“Think of it as Google meets Siebel,” he said. “This whole hosted offering will be a major effort for the company in the next five years. We have never entered a market that we did not believe we could obtain a leader position in.”

The hosted CRM market is predicted to grow from $246 million in 2002 to around $2.8 billion in 2006, he added.

One of Siebel’s closest rivals in hosted CRM services is certain to be, which specialises in sales force automation tools.

Salesforce has enjoyed sharp growth in sales since 2001. It hopes to raise around $70 million from an initial public offering (IPO) of shares, which has been delayed as US market regulators scrutinise the company’s accounting practices.

The company yesterday restated financial results for the last two years. However, the changes to the way that Salesforce accounts for sales commissions made little difference to its top and bottom lines. The restatements appear to have cleared away the final hurdle for Salesforce’s long-awaited IPO.

Meanwhile, it has emerged that some Salesforce customers were hit by about 24 hours of downtime over the Easter period as the service was upgraded to the current version, called Spring 04.

One irate Salesforce user told a discussion board: “I am sure is aware that [the Spring 04] release-related issues cost customers millions in lost productivity (if productivity is a useful measurement) and didn’t help organisations dealing with the in-house versus out-house debate.”

Salesforce confirmed the downtime occurred but stressed that the upgrade was deliberately timed to coincide with the Easter holiday period, in case such issues arose, and that the problem was resolved by the time most businesses returned to work.

Salesforce says it guarantees users 98% planned availability. Its internal research shows that uptime is generally around the 99% mark.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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