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British Telecom drops Siebel for SugarCRM

British Telecom chose to distribute SugarCRM over its incumbent CRM solution and Salesforce. What does this tell us about the market?

On days when your belief in open source may wane, things like British Telecom's (BT) news that it will be distributing SugarCRM Professional and Enterprise editions to its 1.2 million business customers will replenish that belief. And then some.

This is a win for the SugarCRM community, as Sean Michael Kerner notes, even if it's not an automatic win in terms of downstream deployments, as The 451 Group points out.

And lest we forget, it's also a big upfront revenue opportunity for SugarCRM. I'm not privy to the deal, but I know from having done deals like this at Alfresco that the numbers often exceed $1 million. This is particularly rich when it likely comes at the expense of Siebel, which used to be BT's CRM provider of choice.

It's also interesting that BT didn't choose Salesforce. Marc Benioff in his recent Churchill Club rumble with SAP's Plattner was asked about how it competes with SugarCRM. He had ready answers for how he can trounce the big, on-premise vendors like Oracle, but fumbled for an answer (according to an attendee I talked to today) when asked about SugarCRM.

BT, however, didn't fumble for the answer. It chose SugarCRM. There's something very telling in that.

Disclosure: I am an advisor to SugarCRM.