Where will be the next Salesforce.com?

Product lifecycle management, or PLM, may not have the same buzz as CRM. But Arena Solutions CEO Michael Topolovac argues that the PLM category is ripe for the hosted model.

Arena on Monday released an upgrade to its hosted PLM application, which stores complex product-related data for manufacturers and their suppliers. The service also allows them to collaborate on certain tasks, such as customizing a product.

Arena, which has about 2000 customers and 15,000 subscribers, expects to see more companies sign on to it PLM service, particularly mid-size businesses looking to avoid spending costly in-house installations.

"CRM was the first frontier in on-demand software. PLM will be one of the next ones that will be really big," Topolovac said. "With PLM, you're dealing with many suppliers around the globe sharing complex product data. There's a huge advantage of on demand beyond cost and risk reduction."

The company competes with traditional product lifecycle management products but the hosted model allows Arena to roll out updates rapidly and keep its development costs down, since it only creates a single instance of its application, Topolovac said.

The new release, called Arena PLM Fall 2005, is designed to make it easier for manufacturers and suppliers to collaborate, customize the service and comply with regulations around products. Specifically, the service makes it easier to document and audit the products - some of which may be hazardous chemicals - that are used in the making of an end product, he said.