Salesforce's E-commerce Engine Favoring 'native' Apps

Salesforce is developing an e-commerce engine called Force.com Checkout, but for now only "native" applications that are built on its Force.com development platform -- as opposed to ones developed with other tools and then integrated with Salesforce -- can join the pilot program.
Craig Heartwell, chief technology officer of Salesforce partner OnDialog, a maker of marketing software, was irked when a Salesforce representative told him the news, according to a since-removed post on his blog.
"After proving to the world that SaaS can work really well and inspiring a new generation of entrepreneurs to abandon the old software vendor models and become SaaS providers, [Salesforce CEO Marc Benioff] has now decided that the only SaaS that really matters is his SaaS," he wrote. "So he's just been taking advantage of partner companies to build up his own, and he is now abandoning those partners because he wants to be the only player."
Salesforce made its decision because Force.com "wasn't getting enough market traction," Heartwell claimed at another point.
OnDialog integrates its software with Salesforce and is listed on its AppExchange site. Users can browse and test software listed there, but the actual ordering and billing process occurs separately through Salesforce, or its partners, hence the Checkout service.
In a subsequent post, Heartwell tempered his criticisms, stressing that the two companies' business relationship remains intact.
"[Salesforce's] strategy wasn't really a loss of some existing 'thing' as much as a loss of future potential 'things' -- and (in my humble opinion) a negative for customers ... They could have done better by us," he wrote in part.
He did not respond to requests for additional comment.
A Salesforce official adopted a neutral posture in responding to Heartwell's criticism.
"I applaud this partner's passion," said Bruce Francis, vice president of corporate strategy. "The fact that we have passionate partners like this one is a testament to what a great program the AppExchange has been."
There are more than 800 applications on the AppExchange, according to Salesforce. However, Francis could not say how many are natively built: "I don't know if we've added that up and released that number."
As for the Checkout service, Francis stressed that it is still in a pilot phase, but that user feedback is informing the company's decision to admit only native applications for now.
"One thing that customers have been saying is that we want applications built on the same metadata model [as Salesforce and Force.com]," he said.
However, Salesforce hasn't decided whether only native applications will be allowed to use it in the future, he said. "We want to make sure we are responding to the community. We're going to learn from this pilot and learn from our partners. We would be foolish not to listen to what our partners are telling us."
He downplayed the notion that Salesforce wants to lock ISVs (independent software vendors) into its platform. "We want all partners to succeed. Building natively on Force.com is one [way]."
Convio is doing just that, developing an application that nonprofits can use to manage donor information.
The company "did a pretty serious investigation and evaluation of how to enter this market" and decided building on Force.com would be the best approach, said Tom Krackeler, vice president of product management.
"There are tons of ways to integrate third-party apps to Salesforce. None of that is changing," he added.
Salesforce likely wanted to minimize the number of variables while the Checkout service is in its developmental stages, he said. "From my perspective, it was not surprising. It seemed sensible."
Appirio, which has products that integrate Salesforce with Google Apps, also develops natively on Force.com.
Salesforce's platform lets the vendor "focus on solving customer problems, instead of on back office or infrastructure," Ryan Nichols, vice president of products and marketing, said via e-mail. When the Checkout service goes live, it will enable Appirio to focus on its software, "instead of developing yet another shopping cart," he added.
Salesforce first announced its plans for an e-commerce engine in late 2006.
Francis didn't provide a detailed reason for the delay. "A lot of it has been listening to customers," he said.
Part of the thinking behind the Checkout service "is pressure from Wall Street, which is asking them, how can you monetize what you do with AppExchange," said China Martens, an analyst with the 451 Group.
Then again, Salesforce's recent success in winning large enterprise deals may have assuaged investors and bought the company more time to fine-tune the Checkout service, she said.