The new service , said Salesforce.com's vice president Kendall Collins in a statement, is "a new Web 2.0 model for how companies can directly engage customers with on-demand technology." It allows companies to "elevate the customer experience and improve internal productivity," he said.

AppSpace is featured in Salesforce.com's Spring '07 release, the company's 22nd version of updated Salesforce hosted services, including its on-demand customer-relationship management (CRM ) applications, IdeaExchange, the Apex Developer Network, and AppExchange.

Upgraded features in Spring '07, some as the result of customer suggestions, include time-based workflow, the ability for executives to grant approvals even when not logged on, the ability to show reporting hierarchies, and customized search. ApexConnect for Oracle, part of Spring '07, allows integration of Salesforce with Oracle 11i.

Only two months ago, Salesforce, which said it has 646,000 subscribers, released a core upgrade with Winter '07.

Working with Customers

With hosted, on-demand applications, AppSpace enables subscribing companies to interact with their customers through joining together in work processes, exchanging documents, managing projects, sharing spreadsheets, or collaborating using Apex applications with their customers, among other functions.

A company might interact internally or with its customers inside the secure AppSpace environment, using Salesforce.com's hosted-CRM service or applications from Salesforce's AppExchange.

AppExchange, launched in 2006, showcases Salesforce.com and third-party applications. AppSpace is built on Salesforce.com's Apex platform, enabling such on-demand functions as customized workflow and embedded mash-ups. Mash-ups generally refer to content from various sources being combined for comparison or for presentation as layers.

Counse Broders, research director for technology research firm Current Analysis, said that business software was definitely "moving toward collaborative spaces," especially for hosted applications. Some of this, he said, was Silicon Valley and other technology companies looking at MySpace and seeing opportunities for teamwork. "The underlying driver," he said, "is greater efficiency through team collaboration ."

The Security Issue

Broders cited recent hosted software and collaborative developments at several other companies, such as AT&T 's recent purchase of USInternetworking, an application-service provider of on-demand services, and Microsoft 's foray into hosted-CRM applications.

But a key issue for any collaborative environment, he pointed out, is security. "There have been malicious code insertions in MySpace," he said, noting that there are always risks when an environment allows outsiders' data . With MySpace, you might lose your song list, but "business data involves critical situations," he said. "Clients need to be assured that their information will be protected."

Hosted applications do provide quicker and more iterative updates, he noted, which might provide an edge to participating companies' customer management. He pointed to Salesforce's two major releases in recent months as an example.

With prices starting at $995 per 200 users per month, AppSpace will have a limited release in April.