NEW YORK ( Trefis ) -- Microsoft ( MSFT) recently announced the availability of the cloud version of Microsoft Dynamics CRM (Customer Relationship Management) software, called the Dynamics CRM Online. With this move, most of Microsoft's competitors, SAP ( SAP), ( CRM) and Oracle ( ORCL) will feel the heat.

With CRM online, Microsoft is not only undercutting on license pricing, but also giving incentives to Oracle and customers should they decide to switch. If Microsoft is successful in gaining share in the CRM market, it could impact Salesforce stock the most with SAP only slightly impacted.

We have a $128 Trefis price estimate for stock, which is about 3% higher than the current market price. stock most dependent on CRM business

Companies often target all customers equally, irrespective of their needs, and this often leads to resource allocation inefficiencies and customer dissatisfaction. CRM is a software which helps companies acquire and retain customers, gain marketing and customer insight. Without the help of the CRM software, it becomes almost impossible to keep track of individual requirements.

Cloud-based CRM software constitutes around 63% of our estimate for stock, and its market share in the CRM market has rapidly increased from around 7% in 2006 to 14% in 2010, and we estimate that it could continue to increase to around 25% by the end of Trefis forecast period.

However, Microsoft Dynamics CRM online is directly aimed to gain market share mainly at the expense of It has openly announced that eligible customers will receive up to $200 per user as rebate if they switch from or Oracle to Microsoft. Additionally, new customers that sign offer by June 30 can receive promotional pricing of $34 per user per month for the first year. This pricing is much less that what and Oracle currently offers to its customers. currently offers $65 per user for Professional edition and $125 for Enterprise edition. For Oracle, the pricing starts at around $75 per user.

There could be a downside of more than 10% to our estimate for stock if its CRM market share increases slowly to reach around 20% by the end of Trefis forecast period.

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