Salesforce.com CEO Marc Benioff reportedly told analysts today that the company will announce a free version of its enterprise activity stream product Chatter at the annual Dreamforce event in San Francisco next month. The revelation came in a conference call with financial analysts to discuss the company's third quarter financial results, according to CRN. Benioff confirmed the story via Twitter this evening. Salesforce.com currently offers Chatter for free to Salesforce.com users or for $15 a month per user for non-Salesforce.com users. Benioff described the free, stripped down version of Chatter as a "virally based product."
A screenshot of Chatter 2
The move comes as the role of freemium products in the enterprise has become a topic of debate. Last week at Enterprise 2.0 Santa Clara Jive CEO Tony Zingale harshly criticized the freemium business model, comparing freemium to a free puppy (Christopher Lochhead, chief strategy advisor and board member at Jive, repeated the criticism in an article for Forbes). However, companies like Huddle and Yammer are gaining traction for their enterprise collaboration SaaS products using freemium pricing to get the proverbial foot in the door.
Benioff said that 60,000 of Salesforce's 87,200 customers are currently using Chatter. Salesforce.com has referred to Chatter as the company's most successful product launch ever. But Salesforce.com clearly wants to expand Chatter usage beyond its current CRM customer base. A free version may be a path into companies that ordinarily wouldn't think to try a Salesforce.com product. Earlier this year Salesforce.com told us Nokia is deploying Chatter
enterprise wide despite not being a Salesforce.com CRM customer. Update: Salesforce.com has clarified that Nokia is not deploying Chatter enterprise wide.
"And I think SharePoint is very much the same thing," he continued. "It's kind of the grandmother's attic. Customers throw everything into it, [then] they can't find it and they don't know what's up there, and they don't know how to get it out. It's a joke."
Earlier this year Salesforce.com settled mutual patent disputes with Microsoft.