AppExchange – The Potential To Change The Face of Application Delivery

Salesforce.com continues to go from strength to strength. However whilst the recent Winter ’06 event witnessed the expected release of a number of advances to the features of the company’s core applications, by far the most interesting development was the go-live of AppExchange. It is my considered opinion that AppExchange could become the single most valuable facet in the armoury of Salesforce.com. More importantly, AppExchange is a platform that has the potential to become of strategic value to an extremely wide business audience.

There is clear evidence that the model of application delivery to the Desktop using the Web is very appealing to many organisations, large and small. A quick glance at Salesforce.com and its rapidly expanding customer list demonstrates this very fact. Indeed, the company already boasts over 351,000 subscribers located in 18,700 companies worldwide using Salesforce.com’s offerings to support sales, marketing and customer service activities.

Salesforce is doing very well in attracting customers to its core services. However, the addition of AppExchange to its offerings could well bring in very many more new organizations to the ranks of its customers in addition to allowing its existing users to expand their usage of solutions provided via the Web and the infrastructure supplied by Salesforce.com.

So what is AppExchange that makes it so exciting? In essence AppExchange is described by Salesforce as “a Platform for the business Web”. What this means is that AppExchange provides a common system familiar to users of Salesforce by which users can gain access to a wide range of applications supplied by independent software vendors (ISVs) that deploy their tools making use of AppExchange. In addition the platform utilises the same security and data models employed by the core Salesforce offerings along with its recognisable User Interface. Equally, the applications are all priced using the same monthly rental type model.

At the time of writing AppExchange already boasts of over 150 applications and has enjoyed more than 1,800 customer installations. Applications available in addition to the existing Salesforce offerings include software from Adobe, Skype, iAnywhere, Business Objects, Factiva, Pandora Software, ClearMail and Remend. In addition to the application functionality, the use of a single data and security model allows AppExchange software to interact with each other in a seamless fashion. It is interesting to note that the ISVs that have already placed their offerings on AppExchange found it straightforward and fast, to migrate their offerings to the platform.

It is my opinion that the vast majority of organisations will move progressively to utilising the Web as the mechanism for deploying applications to users. “Software as a service” is now maturing and is ready for widespread adoption. The advantages in terms of speed, business flexibility, cost and security are overwhelming.

AppExchange is the first major cross-application vendor platform that supports this model of IT delivery and, whilst it is proprietary rather than “open”, it looks extremely good. I believe that in the not too distant future this model of application delivery and “interoperation” will succeed in attracting very many customers. What’s more I suspect that within a very short time frame, AppExchange could become almost the defacto method of application delivery in many organisations and en route it could well become the most valuable component in the Salesforce Portfolio.