Microsoft Rolls Up Cloud Services Into Office 365, Takes Aim At Google Apps

Today at an event in San Francisco, Microsoft’s Office division is unveiling a new product: a suite of the company’s productivity services called Office 365.

Before now, Microsoft’s business-facing cloud services have been broken up in a few places: SharePoint, Lync Online, Exchange, and Office web apps. Office 365 looks to unify these. Microsoft SVP Chris Capossela says “This is everything we know about productivity brought to the cloud”.

The messaging here seems to indicate that Microsoft is more directly targeting Google Apps, the suite of online products that have been increasingly encroaching on Microsoft’s enterprise market. In what may have been a jab at Google, Capossela says “We can differentiate from our competition, particularly those coming from the consumer space, by making sure our servers are far more reliable”. I’m sure Google would object to this, as it often beats its chest about the security of Google Apps.

Microsoft is going to target small businesses in a way it hasn’t previously: for a business with under 25 employees, Microsoft will charge $6 per user per month; for larger companies, plans start at $2 per user per month for email alone — prices scale up to $27 per user a month, which includes telephony features (voicemail in your inbox) and video/voice conferencing. There’s also a single sign-on to access all of these services. Before now, Microsoft sold its Business Productivity Online Suite for $120/user/year; In contrast, Google Apps runs $50 per user per year, so Microsoft’s new price points are more competitive.

Microsoft says that before now it could only traget around 15% of an enterprise’s budget, because it was only selling software. Now it’s also helping run their infrastructure, which expands the potential market.

Office 365 is going to launch to the public in a worldwide release next year. For now, Microsoft is kicking off Office 365 with a limited beta rollout.

You’ll be able to learn more at Office, which Microsoft isn’t throwing live for another three hours for reasons that I’m sure make sense to them.