Microsoft Online Services Offers SharePoint, Exchange, Communications and Live Meeting to Businesses of All Sizes

This morning, in front of the 4,000 or so attendees at the sold-out Microsoft SharePoint Conference (SPC), Bill Gates raised the curtain on a set of services and products that I think will have a wide-reaching impact on the industry and on the way we administer our enterprises moving forward. Microsoft hosted SharePoint and Exchange services for businesses of all sizes. He also announced the availability of the SharePoint Server Express, a free enterprise search tool, and of Silverlight Blueprint for SharePoint, which opens lots of possibilities for rich user experiences to be built on top of SharePoint.

SharePoint Online and Exchange Online lower the cost and risk of entry into these two powerful platforms through a per-user subscription service. These services expand the offerings of Microsoft Online Services (MOS), an effort that launched in mid-2007 to deliver hosted Exchange services to enterprises with 5,000 or more seats. Now, any business will have access to Microsoft Office SharePoint Server 2007 (MOSS 2007) and Exchange 2007.  The services are scheduled to be fully released in the second half of 2008, but a trial, beta program was launched today for US-based companies, who can register at

Companies will receive named-user licenses for Exchange 2007, Microsoft Office SharePoint Server 2007. The initial release of the SharePoint Online service will support collaboration and content management. Business intelligence, enterprise search, Excel and InfoPath services are not part of this version of SharePoint Online. Limited customization is supported, including SharePoint Designer, but the hosted service will not allow web parts with code to be included.

Microsoft will offer Office Communications Online and Office Live Meeting as part of the suite of services, or as individual services, as well.  A standard license for Microsoft Office LiveMeeting allows 15-user meetings.  In my own experience with various online conferencing software, I’m definitely a fan of LiveMeeting.

The new services are managed through a single, secure, Web-based interface through which you can monitor the performance of the services, add and configure users, submit and track support requests, and manage users and licenses

Pricing has not yet been determined, but in my discussions with the Microsoft product team, I am convinced that MOS is dedicated to making the service competitive with or cheaper than existing hosted Exchange and SharePoint offerings. In fact, I’m convinced enough that I’ll be signing my company up for the beta in full anticipation of subscribing to the service when it is finalized.

I was very excited when I first heard about the new offerings, and I must say I only liked it better the more I learned about them.  But I also had a lot of questions.  I hope my questions, and the answers I was able to obtain, help you better understand what these services mean.

How do these services compare with OfficeLive?

OfficeLive Workspaces and OfficeLive Small Business are services offered by the Live division within Microsoft. They’re fantastic services, delivering SharePoint-based collaboration (in the case of Workspaces) and web site, email and business applications (in the case of Small Business). Any consumer or business can take advantage of these services, which are free of charge for a baseline service with several for-fee addons. The revenue model is advertisement-driven.

SharePoint Online and Exchange Online are managed services, through which you outsource (so to speak) the management of these complex and costly IT services. The revenue model is obviously subscription-based, and there are guaranteed service level agreements (SLAs). These services are definitely business-focused, and are less likely to be attractive to individual consumers.

How do these services compare with Google Sites?

Last week, Google announced Google Sites (, a set of hosted applications and collaboration tools. I’m looking forward to examining this offering more closely, but it appears to be a much more direct competitor to the OfficeLive services than to the Microsoft Online Services offerings.

How will this announcement impact Microsoft’s partners?

A number of Microsoft’s partners—many of them Gold partners—already offer hosted Exchange mailboxes and Windows SharePoint Services.  Fewer offer MOSS. Many of these partners will be migrating to MOS, where the partners provide the front-end and value added services on top of MOS services, including customization, migration, consulting and managed services.  In fact, Atos Origin S.A., BT, Ceryx Inc., Evolve, Getronics NV, HCL, HP and Unisys Corp. have already announced they will support Microsoft Online Services and provide offerings based on the new services.  I currently outsource my business’ Exchange service to Intermedia. Rurik Bradbury, VP of Marketing for Intermedia, said, “Our clients see the Microsoft brand name as industry leading, and its entry into this market gives us tremendous opportunity to grow our business.”  In fact, this was a theme I heard from Microsoft as well: Microsoft-provided hosted services validates the entire hosted service model.

Why should I move to hosted services, and will I have to do so some day?

The answer to the second question is, of course, “Who knows?” But Microsoft’s current “software plus services” model aims to allow you to deliver software on servers you manage, as a hosted managed service, or as a combination of the two. Customers with a subscription have rights to both Microsoft Online Services and on-premises server software, giving them the ability to blend Web-based services with on-premises software.  This flexible, blended approach is certainly the most reasonable way to address the varied needs of enterprises today. 

To make the transition to online services more financially viable, new customers can purchase Microsoft Online Services as a per-user subscription, and existing customers with Microsoft Client Access Licenses and Software Assurance can purchase a user subscription for MOS at a discount.

The reason you should move to hosted services? Cost. My experience has been, both within my own company and in my clients, that a service model is a “no-brainer” from a total cost perspective. As long as service level agreements are in place and are delivered, the cost of migration, upgrade, support, and management plummets.  One of my clients spends, per-mailbox, at least double what I pay Intermedia (who delivers better service than I get within that client’s mail environment). Another of my extremely large clients has had an internal shared Exchange service for hundreds of thousands of users for many years, relieving its business units from the cost and headaches of maintaining a communications platform.

With online services now taking off, companies can move their communications and collaborations platforms to MOS. Coca-Cola Enterprises, Autodesk Inc., Blockbuster Inc., Ceridian, Energizer Holdings Inc., Ingersoll-Rand Company Ltd., PFT-Medway, and XL Capital are among the first companies to do so, and my guess is the tidal wave will only grow from there.  I think this is going to be big.

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