CRM News: CRM: Salesforce Lands Mega Deal for 'Platform as a Service'

Salesforce Lands Mega Deal for 'Platform as a Service'

By Erika Morphy
CRM Buyer
09/06/07 1:31 PM PT

"It is a fascinating win because it means our largest customer is all about the platform," Bruce Francis, vice president of corporate strategy at Salesforce.com. "Our ability to deliver a platform as a service as well as a Software as a Service (SaaS) application is a major differentiator for us."

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Salesforce.com (NYSE: CRM) has signed a contract to supply 40,000 Web-delivered software subscriptions to Japan Post, bringing the total number of deployments to the company to 45,000. The contract is now the largest seat deployment for the iconic on-demand vendor to date.

Japan Post, which is set to be privatized in October, functions as more than just a postal service for the country. One of its primary roles is as a financial services provider; almost every Japanese household maintains a savings account at Japan Post.

Japan Post's original 5,000-seat deployment, announced in April, was for Salesforce.com's CRM suite of products. The additional 40,000-seat mandate, however, will be using a custom application Japan Post developed for customer service inquires and compliance-related issues.

All About the Platform

In terms of seat size and intended use, the transaction is a coup for Salesforce, which has been focusing on applications and development tools aimed at the larger enterprise, rather than its CRM roots.

"It is a fascinating win because it means our largest customer is all about the platform," Bruce Francis, vice president of corporate strategy at Salesforce, told CRM Buyer. "Our ability to deliver a platform as a service as well as a Software as a Service (SaaS) application is a major differentiator for us."

Earlier this year, Salesforce.com introduced its Summer 07 release, dubbing the application a "platform as a service" product because it provided its developer code Apex live for customers in a production environment.

Japan Post's Business Model

The application Japan Post is developing on Salesforce.com gives its employees stationed at 24,000 post offices and retail outlets a channel to report customer and compliance-related issues to regional branches and Japan Post headquarters in Tokyo.

Hitachi Software Engineering Corporation is helping with the development of the application.

Large Seat Deployments

The Japan Post mandate also illustrates the growing acceptance by corporates of deploying software as a service on a wide scale throughout the enterprise. In part, this trend is due to a proven performance record of SaaS vendors.

Enterprises are also deploying SaaS more widely because the applications themselves are becoming more sophisticated. Other large seat wins by Salesforce.com include Merrill Lynch at 25,000, Cisco at 30,000, Sprint at 20,000, ADP at 7,600, Corporate Express at 5,000 and CA at 4,000.

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