This morning during the keynote at the Microsoft Partner Conference in Houston, Texas, head of the business division Stephen Elop announced a new program and suite of hosted online services. The new service offerings include hosted Exchange, Sharepoint, Communication Server and Dynamics CRM – all hosted by Microsoft as part of the new online services platform. The new offerings compete directly with existing partners that offer hosted exchange and sharepoint, as well as the free offerings from Google and others.
The simple ‘deskless suite’ plan starts at $3 per user per month, and includes web-based access to an Exchange mailbox through Outlook Web Access Lite along with read-only Sharepoint access. At the full service plan, which starts at $15 per month – consists of full featured hosted versions of Exchange, Sharepoint, Communication Server, live meeting and more. The capabilities of the standard service plan at $15 per user per month are similar to those of the standard editions of each of these applications.
The full service suite thus costs $180 per user per annum, and includes a gigayte of storage which can be expanded at a cost of 35 cents per gigabye per month. The different components that make up the suite can be added and removed, so for instance without the communication server it is $3.50 per user per month cheaper – and pricing can be further customized on an implementation basis.
Microsoft offering hosted services competes directly with some of their largest partners and revenue providers – so the partner conference was used as the venue to also announce the affiliate and partner program as part of the online platform. Partners who refer customers to the online services platform will earn a 12% commission on the first year of revenues, and from then on a 6% commission on all revenues from that customer. At 12% of $180 per year, it is more than a partner earns on the resale of a standard CAL for Exchange and Sharepoint, so the hope that with a solid revenue sharing model partners will drive growth in adoption of the new online model.
There have already been a number of large-scale customers who have switched over from either competing products, or from old self-hosted Exchange onto the new hosted platform. Companies already running large-scale instances on Microsoft Online include Nokia (who migrated from Notes), Coca Cola, Blockbuster, Energizer and many more. Microsoft have been pushing the online hosted platform and a large number of their larger integration partners are also already working with moving their customers onto the platform as part of the new partner model.
The partner model for the online services platform seems just as, if not more, appealing than existing partnership agreements with software licensing. With an easy-to-use admin interface, and direct integration between hosted active directory and local active directory, rolling out and migrating to the hosted platform is easy. Organizations are able to take single divisions or departments, or just a few mailboxes, and try moving them to the online platform without having to conduct a large-scale migration.
With online services Microsoft are looking to put a stop to the leak of companies heading towards the Google App solution suite. Exchange and Sharepoint are products that operate at a whole different level to the Google online tools, and Microsoft are hoping that a combination of their reputation in the space, their existing market penetration and an easy to use online suite will see them prevail in the market as it shifts to becoming hosted and online.