Microsoft Dynamics CRM Revenue: Debate on the accuracy, importance of new analyst estimates

Gartner's recently released CRM market share numbers for the top five vendors have stirred up confusion and some pointed criticism from analysts and Microsoft-watchers.

The numbers according to Gartner

CRM offerings from Salesforce.com, SAP and Oracle all topped Microsoft Dynamics CRM for revenue, according to the report, "Market Share Analysis: Customer Relationship Management Software, Worldwide, 2012."

Salesforce.com, whose CRM revenue Gartner said grew 26% in 2012, passed SAP, which only grew 1% in terms of CRM last year, as the lead vendor in the worldwide CRM software market in 2012, according to Gartner, Inc. Total worldwide CRM software revenue totaled $18 billion in 2012, up 12.5% from $16 billion in 2011.

Salesforce's CRM revenue for 2012 was $2.5 billion, SAP's CRM offerings pulled in $2.3 billion, while Oracle, whose revenue grew 7.8% last year, came in third with $2 billion, according to Gartner's figures.

Microsoft Dynamics CRM revenue, which also grew 26% in 2012, topped off at $1.1 billion, up from $900 million in 2011, according to Gartner.

The skepticism

"I look at these numbers and I'm always baffled," said Joshua Greenbaum, principal at Enterprise Applications Consulting. "My understanding is that the total revenue for Dynamics (including ERP) is $1.2 billion or in that ballpark. So the idea that CRM is billion ($1.1) is nonsense. But there is an accounting trick that may make that possible and that is if you include what Microsoft calls the attach rate, the SharePoints and the Windows Servers and the Exchange Servers and all that, which is sold alongside CRM, you might get to that number. I would argue looking at Gartner's numbers for SAP, it's not just CRM for SAP, either. The only way I can see getting to a billion plus for ...