Microsoft Office 365 and Dynamics CRM Online Set to Converge

By samdizzy

For the moment, Microsoft Office 365 and Microsoft Dynamics CRM Online are separate cloud platforms. But over time, Office 365 and Dynamics CRM Online will converge in the cloud. And Dynamics ERP will surface in the cloud as well.

Already, Dynamics CRM and Office 365 work well together, according to Kelly Waldher, director of product management for Office 365. But in Q4 of this calendar year, CRM Online and Office 365 will offer a single interface for customer sign-ups, and they’ll be available as a single bill to customers, Waldher said. Microsoft also is preparing to offer Dynamics ERP suites on the Windows Azure platform.

What’s in it for channel partners? Microsoft’s Dynamics business has generated a 20 percent CAGR (compound annual growth rate) over the past 10 years, according to CEO Steve Ballmer. A Dynamics Cloud Profitability Guide, from Microsoft, aims to help partners cash in on that growth.

Many of Microsoft’s business applications — particularly Dynamics, SharePoint and Lync — took center stage at this week’s Microsoft Worldwide Partner Conference 2011 (WPC11) in Los Angeles. Growing sales of those applications offers evidence that Microsoft still knows how to build new, multi-billion-d0llar businesses.

Rethinking Some Assumptions

I must admit: Heading into WPC11, I thought Microsoft badly trailed NetSuite and Salesforce.com in the SaaS applications marketplace. NetSuite seems to make a living attacking Microsoft’s on-premise Dynamics business. But the Dynamics momentum seemed real at WPC11, so I’m rethinking my opinions about Microsoft’s performance in the SaaS and business applications markets. Perhaps it’s better than I had assumed.

Still, Dynamics CRM Online and Microsoft’s other cloud applications continue to face questions from selected partners, some of whom want Microsoft to change its policies for end-customer billing.