When he unveiled Salesforce.com’s AppExchange, Marc Benioff called it the “eBay of on-demand software” as well as the “iTunes Music Store of enterprise applications.” I thought of an earlier precursor: IBM’s SHARE user group. Back in the 1950s, when businesses began buying computers for the first time, there was one big problem that held everything back: a lack of software. There was no software industry then, there were only a few programmers (most in the military), and the makers of mainframes supplied only the most rudimentary of programs with their machines. Faced with the high cost and enormous difficulty of writing code, a lot of companies sat on the sidelines and even those that did buy mainframes couldn’t do a lot with them. IBM, realizing that the lack of software might kill off demand for its machines, organized a user group for the owners of its 700-series mainframes. The members of the group, which came to be called SHARE, simply gave one another the software they had written. By providing easy and cheap access to an ever-growing pool of applications, SHARE helped jump-start the mainframe market while also increasing the attractiveness of IBM’s own products (the software, of course, couldn’t run on other vendors’ machines).

My guess is that Benioff hopes AppExchange will set off a similar phenomenon: expanding the pool of hosted “on-demand” software while increasing the attractiveness of Salesforce.com’s proprietary platform. It will be interesting to see how many users, as opposed to developers, post their own creations.