• The Wall Street Journal, Monday, May 21, 2007 10:45 AM

Google is exploring the possibility of teaming up with Salesforce.com to better compete with Microsoft in corporate communication and customer-relationship management services, one of its core business sectors. The report is short on details, but it speculates that a deal would be about integrating Google's Web-based services, like email, instant messaging and Google Apps, with Salesforce.com's CRM tools, also Web-based. Microsoft's productivity tools, of course, are software-based.

Microsoft and Google have been competing in search and email for several years, but the corporate market has long been the province of Microsoft. Search giant Google only entered the field a few months ago through the enterprise-level offering of Google Apps, which consists of Google Docs & Spreadsheets, Gmail, Google Talk and Google Calendar. Salesforce.com's CRM tools would likely be an optional add-on to Google Apps. The Web-based services are attractive to businesses (particularly startups) because they're far cheaper, though Microsoft's software offers better security.

On Friday, Google said it was releasing a new product called Google Apps Partner Edition, which has both a free service, as well as a package that include phone support and marketing services. In response to Google's ultra low-cost services, Microsoft is said to be preparing Web-based versions of its CRM software, too.

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