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July 8, 2008

Microsoft unveils new Microsoft Online Services offerings

Posted by David Hunter at 1:09 PM ET.

Microsoft today unveiled two new Microsoft Online Services offerings, Exchange Online Deskless Worker and SharePoint Online Deskless Worker as well as a Deskless Worker Suite that combines the two. The target market is enterprises with workers who don’t spend their day in front of a computer or perhaps not even at a desk, but still occasionally need typical information worker computer services:

A Deskless Worker Suite, including Exchange Online Deskless Worker and SharePoint Online Deskless Worker, will be available for $3 (U.S.) per user, per month. Customers can also subscribe to each service independently. Exchange Online Deskless Worker will provide e-mail, calendars, global address lists, anti-virus and anti-spam filters, as well as Outlook Web Access Light for access to company e-mail. SharePoint Online Deskless Worker will provide easy access to SharePoint portal and team sites and search functionality, giving employees read-only access to important information such as company policies, training and benefits.

Microsoft is also targeting traditional information workers via an offering apparently named the Microsoft Business Productivity Online Suite:

For information workers, businesses can provide an online business productivity suite of Microsoft’s enterprise-class communication and collaboration software as a subscription service. The suite includes the following:

  • Exchange Online for desktop and mobile e-mail and calendars with Outlook Web Access and full Office Outlook integration
  • Office SharePoint Online for portals, collaboration, search and customized team sites
  • Office Communications Online for instant messaging and presence
  • Office Live Meeting for Web conferencing and videoconferencing

The suite will be available for $15 per user, per month (U.S.). Customers can also subscribe to each service independently.

As I have observed before, this (except for Live Meeting) is merely managed hosting of Microsoft server software and Microsoft’s venture into this market has always had the problem of undercutting partners who were offering equivalent hosting services before Microsoft Online Services was even a gleam in Microsoft’s eye (e.g. hosted Exchange). An obvious salve for the wound is to cut partners in on the deals and in that regard Microsoft also revealed some partner commission terms:

Microsoft Online Services creates a new opportunity for Microsoft partners to win new customers, increase revenue and boost sales velocity. Partners are seeing new opportunity to migrate, combine and customize Microsoft Online Services. In addition, partners that sell Microsoft Online Services will receive a recurring revenue stream for as long as their customer subscribes to the services.

Partners that sell the Microsoft Business Productivity Online Suite, Deskless Worker Suite or any of their components receive 12 percent of the first-year contract price and 6 percent of the subscription fee ongoing. This can translate into 18 percent of the subscription value in the first year of the partner’s relationship with the customer.

While not wildly lucrative, it is certainly better than nothing, and it allows the partners to focus on their particular value-adds while leaving the high-capital outlay/low profit margin managed hosting business to Microsoft. Who says Microsoft isn’t their partners’ pal? Presumably Microsoft’s fear of Web app providers and their perceived ability to defeat Microsoft managed hosting partners in the marketplace is what is driving Microsoft to make what seems like an unneeded and not particularly rewarding investment in Microsoft Online Services.

One final note – as far as I can tell, all of the Microsoft Online Services discussed above except for Office Live Meeting are still in beta although you have to read the fine print to discover that.

Update: Elsa Wenzel at CNET has a nice chart of the various offerings and their prices, and observes:

Exchange Online and Office SharePoint Online remain in beta, with final availability set for sometime in the second half of 2008, when Office Communications Online beta is also due. Microsoft plans for international availability in 2009.

Filed under Beta and CTP, Hosted Services, Microsoft Online Services, Partner Program

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One Response to “Microsoft unveils new Microsoft Online Services offerings”

  1. Microsoft unleashes Exchange Online and SharePoint Online | Microsoft News Tracker Says:

    [...] promised back in July, Microsoft today took Exchange Online and SharePoint Online out of beta: Today, at a launch event [...]

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