Microsoft shows SaaSy SharePoint/Exchange

In Tuesday's IT Blogwatch, Richi Jennings watches bloggers watch Microsoft offer SaaS-hosted Exchange, Sharepoint, and OCS to all. Not to mention a cooler Google Android phone...

Stephen Lawson reports:

Microsoft Online Services launch
In five years, Microsoft Corp. expects half of all enterprise employees with e-mail to use combined online and premises-based systems ... About 500,000 users have already adopted Exchange Online since a limited release for large enterprises in October 2007 ... That release made the two applications available, on dedicated Microsoft servers, to enterprises with 5,000 or more employees.

Starting Monday, the services are available to all small, midsize and large organizations in the U.S., hosted on shared resources at Microsoft. They can be purchased online or through partners ... their wide availability is a key step in Microsoft's transition from a maker of client and server applications to a provider of ones that are hosted in the Internet "cloud" and available through any browser.


Exchange Online and SharePoint Online can be purchased as part of the Microsoft Online Services Suite, which also includes Office Live Meeting and Office Communications Online, for $15 per user per month.

Benjamin J. Romano is grate: [Groan -Ed.]

Microsoft is making an economic pitch for its services ... Companies can save 10 percent over running the same Microsoft software on its own servers and up to 50 percent if Microsoft Online replaces legacy systems, [Microsoft] said. The savings come from lower server hardware and software costs, and less demand on IT staff to maintain those systems.

Microsoft is offering customers a "three nines" service level agreement (that's 99.9 percent up time) backed by financial guarantees.

Here's Joseph Tartakoff:

With Microsoft's offering, businesses will be able to purchase it on a subscription basis directly from Microsoft or through resellers, who have been hosting Exchange and SharePoint on their own servers for years ... (some of these partners are not too pleased with Microsoft's entry into the market).

David Hunter agrees:

it is likely good business for all concerned except the Microsoft partners who used to provide similar managed hosting before the 800 pound gorilla entered the market. The partners do get the table scraps however.


However, one downside for Microsoft is that the managed hosting business tends to be high in capital outlay and low on margins unlike Microsoft’s core software business.

Microsoft's Steve Clayton drops his disguise:

Microsoft estimates that companies can save at least 10% (and up to 50%) by letting Microsoft run their messaging and collaboration software for them.

A bold claim but I believe him and have been doing some modeling of customer scenarios myself for the last few days and his claim stands up ... You don’t need to know much about the current economic climate to know that is music to the finance directors ears.

But your humble blogwatcher retreads an old post:

Microsoft ... Online hosted services [are] not to be confused with Exchange Hosted Services, which is the hosted email security service formerly from Frontbridge.


For the combination of Exchange, OCS, LiveMeeting, and SharePoint Online, Microsoft announced the price would be $15. $15 is too expensive. Here’s two reasons why:


Compare that price with Google Apps at $50/year ($4.17/month).


Over the past ten years, we’ve seen vendor after vendor try to offer hosted Exchange ... charging more than the market would bear. Looks like Microsoft is making the same mistake.

And finally...

Buffer overflow:

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Richi Jennings is an independent analyst/adviser/consultant, specializing in blogging, email, and spam. A 23 year, cross-functional IT veteran, he is also an analyst at Ferris Research. You can follow him on Twitter, pretend to be Richi's friend on Facebook, or just use boring old email:

Previously in IT Blogwatch:

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