Threat of Entry

What sets salesforce.com apart from its competitors and other companies is its unique strategy for combatting the threat of new entrants while adding value to its product. In 2006 Salesforce acquired Sendai Corporation, which later became Force.com.

Force.com is a platform that allows developers to build apps for Salesforce. Developers can then sell the apps they they developed on the Force.com platform on Salesforce's AppExchange.

By allowing developers to build and sell apps that provide a more customizable and scalable product, Salesforce is basically crowdsourcing a large portion of its R&D without absorbing much risk. As more developers create and sell more apps, and the platform gains in popularity, the greater the network effect will be. 

Since developers have a revenue stream available through SalesForce's AppExchange, they are less likely to become new entrants. The AppExchange also allows SalesForce the opportunity to acquire top developers. 

I have a feeling that this model for fighting off new entrants will be oft repeated.