Microsoft Expands Business Online Services

Microsoft's strategy of "Software plus Services" got an emphasis on services Monday as the company expanded Microsoft Online Services to small and midsize businesses. Companies with more than 5,000 employees got the services first last September. Those services include Exchange Online, SharePoint Online, Office Communications Online, and Office Live Meeting.
Microsoft Chairman Bill Gates was to make the announcement at the company's SharePoint Conference in Redmond, Wash. "With Microsoft Online Services," he said, "businesses can deploy software as a subscription service, from servers they manage on-site" or that others manage. He added that this choice is being added to all of Microsoft's products.
Exchange Online uses Microsoft Exchange Server 2007 for communications, and SharePoint Online accesses Microsoft SharePoint Server 2007 for collaboration. The services will be available to all businesses in the second half of the year, and a trial can be accessed at http://www.mosbeta.com.
The services include e-mail, calendaring, contacts, shared work spaces and videoconferencing, plus real-time security, compliance and business continuity. They can all be managed through a single Web-based interface that enables monitoring, configuring users and tracking requests.
Many vendors are trying to reach the large market of small businesses, said Merle Sandler, an analyst with industry research firm IDC. She added that "it's too early to tell" if Microsoft's
approach will work, noting that the software giant is apparently most interested in the higher end of "small businesses," which IDC defines as under 100 employees, as well as midsize businesses.
Sandler pointed out that software as a service (SaaS) is "such a logical way for a small business to go," with most small businesses lacking a full-time IT person until they hit about 50 employees. So, she said, any SaaS targeting that lower end would need to be manageable by regular employees.
Enter Google
One company targeting the lower end is Google, which Microsoft sees as a key competitor in search, advertising and now online business services. The search giant has been steadily releasing online services for businesses, consumer groups and others.
Last week, Google released Google Sites, a free collaborative service that the company said "makes creating a team site as easy as editing a document." Examples shown were an intranet, a project site, an employee profile, and a classroom site. A variety of document types can be shared, including text-based documents, video, photos, calendars, file attachments, and presentations.
Many observers have characterized Google Sites as a first-level competitor to Microsoft's SharePoint. Earlier in February, Google also released a new Team Edition of Google Apps, which allows employees to set up work groups if they have e-mail addresses within their company's domain. The collaborative groups can be set up without the involvement of IT personnel, although some IT-managed controls have been offered.