Zoho CEO Sridhar Vembu published some interesting news about his interactions with salesforce.com, inc. (NYSE:CRM) CEO Marc Benioff.  It turns out that Salesforce wanted to buy-out Zoho outright.  They made this offer after Zoho accepted an invitation to participated in AppExchange.  Zoho held their ground and refused the acquisition offer due to cultural compatibility.  

After the acquisition talks fell through, Zoho was told to discontinue their CRM software into the AppExchange.  

“I was furious because both Benioff and his team clearly knew we had a CRM offering going into this engagement, and if they had set this as a pre-condition for us to integrate into AppExchange, we would never have put in the resources we did,” stated Vembu.

Salesforce recently announced a partnership with Facebook.

Zoho is the online office enterprise software company that has a suite of 18 applications.  This includes an e-mail, chat, word processing, document collaboration, and several other software products.  In the next couple of weeks, Zoho plans to launch an application store based around Creator.  Creator is Zoho’s Ajax-based database application software that works seamlessly using a drag+drop interface.  Their application store will launch on the week of September 29.

Third party developers will be able to sell their products built around Creator and share in the revenue.  Developers of the third party software will be able to keep 100% revenue.  Zoho makes money from charging the developers to host applications that consume a large amount of bandwidth.  The smaller apps will have the option to run on Google servers.  

Zoho’s most popular software is called Zoho Writer, Zoho Sheet, Zoho Show, Zoho Mail, and Zoho Chat.  “We are trying to be the IT department for SMBs (small- and medium- sized business,” stated Zoho evangelist Raju Vegesna.

Zoho Business was officially announced at the Office 2.0 Conference in San Francisco, Calif. these past couple of days.  This new suite will take on Google Apps head-on.  Zoho Business will have two versions of their services: Free and Pro.  The Professional version will cost about $40 per user per year.

Although Zoho Business is currently in private Beta, it will become public next month.   Zoho Business Professional will have extra storage, phone support, security, enhanced customization, and group control.

ReadWriteWeb has some additional information and screen shots.  Zoho has 15 different applications and has 120 developers working on their suites.  Zoho is a division of AdventNet and is serving 10,000+ customers worldwide.