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Salesforce.com signs AMD, updates software

The software-as-a-service company makes one of its largest deals ever, taking on Advanced Micro Devices. It also plans to introduce a new version of its software by the end of the month.

Software-as-a-service company Salesforce.com has signed one of its largest deals ever, a three-year contract with Advanced Micro Devices, Salesforce said Monday.

AMD has agreed to buy Salesforce's set of customer service, sales and marketing applications to outfit 800 employees, Salesforce said. The San Francisco-based company was unwilling to disclose the dollar value of the contract but said the agreement is among its three largest. The average Salesforce customer purchases software for about 14 users, the company said.

Based on the $125 monthly subscription fee the company charges per software user, it appears the deal could generate at least $3.6 million for Salesforce.

The company competed with rival Siebel Systems for the AMD contract, Salesforce Chief Executive Marc Benioff said. Siebel, the largest company in the niche for so-called customer relationship management software, recently launched a pay-per-month software package that competes with Salesforce.com. The package came about through the acquisition of UpShot and a partnership with IBM Global Services.

A Siebel representative was not immediately available for comment.

Salesforce also said that it plans to introduce a new version of its software called Salesforce.com Winter '04 by the end of the month. The release includes new work-flow capabilities aimed at triggering responses to certain business events, such as prompting a credit check when a sales negotiation reaches a particular stage, said Tien Tzuo, vice president of product marketing for Salesforce. It's also designed to send customer account representatives alerts via e-mail or pager when, for example, a customer requests service or calls in with a problem, he said. Such features are intended to prevent customer-retention and sales opportunities from slipping through the cracks.

Salesforce plans to release the new version of its applications Nov. 24. The company announced the AMD contract and the product news in conjunction with it first customer and developer conference this week in San Francisco.