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Response Point with Service Pack 1: Microsoft's Most Underappreciated Product of 2008

I often argue that Microsoft's biggest strength, its ability to create enduring platforms, can also be its biggest weakness: It seems that every time the software giant tackles a problem, it hides in a hole until it can emerge months or even years later with a fully-fleshed-out, be-all, end-all platform of some kind. That kind of strategy works well when the platform in question is quickly adopted by a wide range of partners and customers--and the rest of the industry doesn't race to fill the gap. But sometimes a platform's slow ramp-up can harm the chances that the underlying solution--the reason they created that platform in the first place--is ultimately successful.

Consider Microsoft's communications products as an obvious example. Building off of the success of its Exchange Server messaging platform, Microsoft is busy working to replace the PBX systems in enterprises with--go figure--a software-based platform that builds off of Exchange and integrates with Microsoft Office and other obvious products. It's a soup-to-nuts solution that scales like it should, offers a dizzying array of functionality, and--as you'd expect of any Microsoft enterprise product--is likewise complex to manage and license.

And then there's Response Point, Microsoft's small business phone solution. Created out of a skunkworks research group buried deep inside the software giant, Response Point is a hidden gem, the most underappreciated product that Microsoft sold this year. What makes Response Point special is that it was created despite Microsoft's platforms mentality. You see, Response Point addresses a simple problem simply. It is, perhaps, one of the most elegant products Microsoft has ever created. And it has absolutely nothing to do with the company's enterprise communications products. There's a lesson to be learned here.

In rejecting the platform approach because it doesn't make sense for the market its addressing, the Response Point team also rejected another typical Microsoft leaning: The product they created isn't a watered down version of an enterprise product, something that's been detuned for typical small business users. Instead, Response Point is conceived, designed, and sold specifically for the small business market. What a concept.

Now, I realize most of you don't even know what Response Point really is, so let's step back a bit. I think of Response Point as a small business PBX replacement in a box. It consists of an XP Embedded-based base station and five or more satellite phones. It connects to one or two traditional phone lines and uses Ethernet-based network cabling internally for connecting it all together. It targets businesses with 50 or fewer users and assumes that those users don't include a single IT pro among them. It's the kind of thing I get excited about because it's empowering to users: This is exactly what technology should be like.

Response Point systems consist of an XP Embedded-based base station and any number of satellite phones.

Since I first wrote about Response Point back about a year ago (see Microsoft Hits the Response Point) a few things have changed. First, Microsoft has shipped a service pack 1 (SP1) update that adds some useful additional functionality to the product, including true Voice over IP (VoIP)-based external calling that allows you to assign multiple area code/phone numbers to a single line, providing "local" numbers for different customers and other contacts. (SP1, of course, is a free update to existing customers.)

On the partner side, you can now purchase Response Point packages from Aastra, D-Link, and Quanta, and retail presence at stores popular with small businesses, such as Costco, should help get the word out. We're also starting to see some particularly innovative solutions, including new form factors, such as the first wireless phone, and breakout boxes that let you use your left over traditional phones as nearly full-featured Response Point phones.

Looking ahead, Microsoft is working on another update that may or may not be called SP2 and will ship sometime in the first half of 2009. I can't say too much about that release right now, but I'll be testing SP1--and, later, SP2--in my home office over the next few months, so I'll have more information about that when it's available.

Also, Microsoft is of course looking into bridging the gap between Response Point and its enterprise communications tools, though the timing and form of such a future release is of course up in the air at this point. (Also unclear is whether some future merging of these products lines would leave early Response Point customers behind.) But I think this is the right way to do things: Get a desirable solution into the market quickly and worry about product and marketing integration later.

If Response Point has a true Achilles heel, it may be the price: At about $1800 for a four-phone system with base station, Response Point is probably a bit much upfront for the typical small business. But I think it's worth the price and will pay for itself over time: After all, the up-front acquisition costs are likely your only real expense over time. But Microsoft is aware that they need to get the price down in order to reach a wider audience. Maybe that will be among the advances this unheralded product makes over the next year.

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