For many years we have talked about our vision of the end of software, said Woodson Martin, vice president of product management, internally we had a vision based on the end of software and managing all business data on demand. We’ve done a great job historically managing structured data…but over 85% of data is not structured.

Using its acquired technology and expertise the SaaS leader plans to launch Apex Content, a content management extension to the Apex platform and ContentExchange, an on-demand content management application that exposes the platform services and adds a user interface to enable users to manage unstructured data. The Koral technology is effectively being rebranded and integrated at the platform level with the Salesforce.com technology.

Financial details of the Koral acqusition were not disclosed.

What is interesting about the Koral technology is that it has taken a different approach to content management, making use of consumer web and Web 2.0-type operations to make the functionality more intuitive.

For example, instead of using hierarchical folders, it uses tags to classify data, replacing a formal taxonomy with the concept of folksonomy.

Under Salesforce.com that approach will be maintained, along with the objective of making it easy to contribute to the corporate data repository through devices such as a widget on the Salesforce desktop onto which data can be dragged and dropped, whereupon it will be automatically indexed and suggested tags can be offered up.

According to Martin, organizations have tried managing content using hierarchical folders and corporate librarians to abstract and describe data but it has not worked well because the processes were cumbersome and potentially inaccurate. As with Salesforce.com, Koral’s approach was to take technology and approaches from the consumer web and make it available within the corporate environment.

There are potential issues arising from Salesforce.com’s strategy of integrating third party technology which could lead to a complex web of technologies over time. There may also be concerns that the folksonomy approach could be inefficient but Martin maintains that variability is positive.

If one person in a group sees it that way, it is probable that others will too, he said. As multiple tags and descriptions can be added to each item in the repository, the descriptors can grow over time, in theory improving accuracy.

The content management functionality can only be used on data stored and managed within the Salesforce.com environment, so at the moment the offering appears to be just another content management application and one that its restricted in terms of where it can be used, namely on Salesforce system data. However, usage is all in the Salesforce.com world view. Just as adoption of its CRM application spread virally due to its usability and accessibility, managing to displace traditional CRM systems because it was being used, the company is banking on the same thing happening in the content management field.

Our View

Salesforce.com has been – and continues to be – a highly disruptive force in the business application space but its success has been largely due to the SaaS model rather than radical changes in software design. For all its use of consumer web technology and approaches, usability and accessibility, it has replicated traditional CRM systems in terms of their database-centric design methodology.

With Koral as an example – ditching hierarchical folders in favor of tagging which goes to heart of application design rather than tinkering around the edges – it can start to experiment with new design approaches for other enterprise application developments.

The new direction also appears to confirm that it has set it sights beyond traditional software vendors and is heading for a Google showdown.