Siebel set to sign on the .Net line

Guy Matthews wonders which company is helping which as Microsoft partners with the CRM vendor to boost its web-based strategy.

During a visit to London last month, Microsoft chief executive Steve Ballmer told us to watch this space and wait for a few weeks until the company announced an enterprise application partner for .Net, its 'bet the ranch' strategy.

It was always obvious that Microsoft would look to Silicon Valley for a partner and, with Oracle out of the picture and PeopleSoft a long-odds outsider, Siebel Systems was the no-brainer, and so it proved to be.

Although not doing spectacularly well itself, Siebel is being lined up as the company that will take Microsoft directly into the heart of corporates.

But who is helping whom? Siebel reported its first loss since 1997 in October, and Microsoft stood out for its profit, which doubled on sales up by 26 per cent.

Microsoft must make .Net work and, for that to happen, it must engage with more companies that operate in markets where it is not traditionally strong. It needs partners that are sufficiently weak to have to take an interest.

Looking for partners in an IT recession is also a no-brainer, but it is the classic response to threats that are beyond your control.

And at the vendor level people have traditionally partnered with Microsoft from a position of weakness and often paid the price. Microsoft now says that it realises it must be a more responsible partner, so perhaps for Siebel the timing is good.

The rationale seems to be that Siebel is signing up with Microsoft to push .Net-based customer relationship management (CRM) into the small to medium sized enterprise (SME) market. Whether Microsoft is happy to stay there is another matter.

One of the main problems with .Net is that there remains a vagueness about what is at the heart of it. Yes, it is about web services and building internet-centric applications. It has Enterprise Server.Net; .Net framework; .Net security; ASP.Net, plus many more core technologies.

The irony is that Microsoft spent several years and truckloads of money implementing a SAP R/3 enterprise resource management system (twice) as the basis for its internal systems. And now everything from buying to stock management in Microsoft is driven by SAP.

So whether Microsoft buys Siebel or the two split in acrimony as Microsoft drives its CRM business from the SMEs into the corporate data centres is a sideshow.

Now that Microsoft sets about convincing the world that web-centric applications and CRM are the future, it will be interesting to see how it drags itself into a .Net-centric 21st century.