Microsoft Corp.'s Dynamics CRM 3.0 has the potential to usher in a rush of business for VARs, ISVs and systems integrators as end users accept the opportunity to adopt CRM technology or migrate from their current systems to a new standard bearer, Microsoft and its partners said.

The latest release from the software giant is designed to provide easy integration and low total cost of ownership, even offering a hosted subscription-based option provided through partners for $24.95 per user per month.

"I think we're looking at a new standard bearer," said Marc Harrison, president of Silicon East Inc., of Manalapan, N.J., a Microsoft partner specializing in real estate and construction companies.

"This is going to be what Act! was for the 1990s and GoldMine before that. They've answered a lot of the price and integration concerns that kept a lot of people away from CRM."

Microsoft executives said they designed the application to address key challenges they saw as roadblocks to customer relationship management adoption in the marketplace, especially in the SMB (small to midsize business) arena.

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Microsoft built in role-based capabilities, making the application relevant throughout organizations; offering easy integration and low total cost of ownership, said Brad Wilson, general manager for Microsoft Dynamics CRM.

Offering a hosted version, due Jan. 1, of Dynamics CRM will be an effective way to counter the on-demand offerings from Salesforce.com and Siebel Systems Inc., said Joe Horvath, director of sales at iFusion Solutions, Inc., Vancouver, British Columbia.

The hosted version will likely be attractive because "it offers customers to ability to get up and running fast at a low cost," Horvath said.

He expects that iFusion will offer the service for about $60 per user per month, which should be a cost effective rate for customers who don't want to implement the software on their own sites, Horvath said.

He said iFusion currently has about 40 Microsoft CRM 1.x customers and that he expects that 5 percent to 10 percent of iFusion's new customers will want the hosted version of the product.

Harrison said he sees the subscription option as a new sales tool as well as a new route to market.

Click here to read more about Microsoft's CRM offerings.

He already used the availability to close a deal with a title searching company in New York that was hesitant to make the investment in a locally based system.

"He basically doesn't have money, and he's not convinced that he wants to make the investment in owning the solution," he said. "I said, 'Why don't you try the pay-by-the-month? If you like the product, you can always migrate.'

"Larger companies have the IT staff to evaluate a system; they have the budget to invest, and they have an understanding of the benefits," he said.

"The SMB doesn't have any of that. They're hesitant to make a multi-thousand-dollar investment on faith. This allows them to try and cancel if it doesn't pay off."

Not all partners, however, see CRM 3.0 as ubiquitous solution in the market.

CardScan Inc., of Cambridge, Mass., which integrates business card scanners with CRM and other databases, is one of the earliest third-party developers to collaborate on the application.

CardScan is betting that CRM 3.0 will be a major player, but it won't put all of its eggs in Microsoft's basket.

"We know everything Microsoft does, they're going to be a player in, and we believe they have a very strong future," said Tom Stearns, CardScan's director of marketing.

"But there are other players in the field, that are going to remain relevant and in some cases will be more appropriate for a business."

Editor's Note:This story was corrected to identify the full name and location of iFusion Solutions.