Dotcoms may have fallen out of fashion, but there's one at least that's doing very nicely.

Since its launch in March 2000, salesforce.com has gathered almost 8,000 customers and now has 110,000 paying subscribers.

It has a revolutionary model in which customers pay for their customer relationship management (CRM) and related applications on the web for $50 (£29) per user per month. If you don't like the service, you don't pay, and you only ever pay for what you use.

Can it make money? And if it can, where does this leave traditional vendors such as Siebel and Oracle, both of which are trying to emulate this model?

Computing talked to salesforce.com founder, chairman and chief executive Marc Benioff when he visited London recently, and found a man on a mission.

With 20 years' experience at Oracle Benioff has his sights firmly set on destroying the 'fatally flawed' software business model that his old company did so much to create.

Is growth coming from existing customers or new customers?

Most customers have been screwed by the big software suppliers. And most small and medium-sized customers have been left out in the cold. Even the software they have been sold may not have been installed.

You just don't see a lot of customers who are happy with what they have bought. This is a wide open market.

How do you deal with the competition?

Research shows that 45 per cent of CRM software is instant 'shelfware'. People are unhappy with their software and are getting negative return on investment. Is that the fault of Siebel? No. Is it the fault of Oracle? SAP? No. It's the fault of the model.

They have bought into a model and because of that they have a problem. It wasn't that Tom Siebel had a bad idea about automating sales, or a customer service group or a marketing organisation.

All that was a good idea. It's not Tom Siebel's fault. He just bought into a model that was already there and was flawed. We just have a different model.

Where do you see the major innovation coming from?

The BlackBerry is a great example. Here we have an integrated device you can hold in the palm of your hand. What's interesting is the size, the fact that it is a converged device, the speed and that it is a global device. I don't have to make any changes when I travel.

With salesforce.com running on it, I can get all my forecasts, I can talk to all my customers. It's a nice screen and it's easy to use.

Will this make a lot of difference to your business?

What's going to make the difference is that this sort of device is showing people are much more internet-centric. So let's say you wanted to build an application that was a mobile application. It could be retailing or shipping, or something. How do you build that? What software do you use?

You can't use the same old stuff. Let's say you wanted to get into your VPN and things like that. It's non-trivial to build an application that goes from a client such as Blackberry and goes to any other kind of service or server.

Where are you on alliances with partners such as BEA, Microsoft, Borland and Sun Microsystems? What is being developed?

We are doing something that's not easily understood. Even by us. It's called client/service computing. We have encouraged companies such as these to modify their tools to look at our service as though it was a database.

Like a client/server tool, you run JBuilder and run it against Oracle and build a client/server application. Although in this case you build a client/service application. So our service to these tools looks like a database.

This has never been done before. We are either really wrong or we are really right. It's one of those two.

I think we are really right, because what you can do is take these tools and deliver data to them in a way that previously was not possible.

Do you run all the applications?

Really, that is our only business. We are a database company and we are in the application development and deployment business. Our business is to develop a range of software and to do it on a platform, called sforce.

Sforce.com is our whole application development business. That's what we use and now we are making it available for the first time for other people to use it.

If they are building applications they can do it much cheaper. You don't have to buy all this hardware. You don't have to buy all this software. You don't have to buy all this stuff.

We charge a runtime of $50 (£29) per user per month. At Oracle we would charge you so much for the database and you would buy the hardware.

This is very much a New Age company. It's a business company. It's an enterprise automation company. It's a database company. It's a tools and application company. But it's not a software company. It's a services company.

We can do what SAP does, what an Oracle or a Microsoft does, but we do it all as a service and this is a viable alternative. And we've proved - and this was the hard part - that you can make money doing it.