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Mobility, Microsoft believes, is the key to breaking Oracle’s and Salesforce.com’s stranglehold on the customer relationship management (CRM) software market. Its forthcoming update to Dynamics CRM, already a top challenger in a crowded landscape, is designed to capture the attention of more mobile and social enterprises.

Microsoft announced early this week it will release a new version of Dynamic CRM in the second quarter that will include support for all of the major mobile device platforms, including Windows Phone 7, Apple iOS, Android and Blackberry. Via the cloud, users will be able to access their CRM device from virtually any Web-connected device, extending the potential universe of Microsoft CRM customers.

“In today’s hyperconnected world, customers need to be able to access their business-critical data on the device of their choice from wherever they are,” said Dennis Michalis, general manager of Microsoft Dynamics CRM. “These advancements, combined with the strength of the Microsoft platform, make Microsoft Dynamics CRM an obvious choice for any business.”

The extended support for non-Microsoft devices is tactic acknowledgement by Microsoft that rivals in the mobile world have become entrenched in their target customer environments. In other words, Microsoft has no choice but supporting these increasingly popular devices if it wants to gain market share in the highly competitive CRM market.

While Microsoft is among the major players in the CRM market, it’s not a leader. According to IDC, Oracle is the market leader with nearly 12 percent market share, followed closely by SAP. The growth leader continues to be software-as-a-service pioneer Salesforce.com, which has roughly 8 percent market share.  Of nearly four-dozen vendors offering CRM applications, only these three earn more than $1 billion annually in CRM sales.

Microsoft’s CRM market share isn’t insignificant. According to published reports, Microsoft earns somewhere between $300 million and $500 million annually on Dynamics CRM sales. It’s among a field of 19 vendors earning more than $100 million from CRM, and it’s a position Microsoft has long wanted to enhance. Microsoft wants to be among the top three vendors rather than the middle of the pack.

Extending agnostic support to mobile devices is only part of Microsoft’s strategy with this release. It’s also adding social features that make it easier for users to communicate with colleagues. The idea behind these features is to make account status, deal-filtering and production needs flow easier through organizations.

Microsoft’s addition of social features follows a trend by other CRM vendors, including Salesforce.com and its Chatter app. Many enterprises are looking to socialization mechanisms to improve the speed of information dissemination. Socialization is part of a growing trend to reduce enterprise dependency on email as the primary means – and bottleneck – of team and interdepartmental communications.

Microsoft is counting on more than just Dynamics CRM becoming more appealing to mobile users – it wants to make an integrated cloud, on-premise and mobile system more viable than competitive offerings. The big selling point is that mobile users will have the same access and application resources regardless of their location.

The integrated nature of Dynamics CRM will make holistic systems more palatable and increase the average sale price. If Microsoft gains traction through this strategy, it will increase share through existing customers adopting the mobile platform and new customers adopting the holistic systems. That will be good news for Microsoft and its reseller partners.

Editor’s Note: This blog was updated to correct a factual error. Assistly was acquired by Salesforce.com last year.