Microsoft: Office Web Apps coming to its hosted business suite

Microsoft has definite plans to add Office Web Apps to its hosted Business Productivity Online Standard Suite (BPOS), but the company isn't providing a specific timetable for the integration.

Without those applications, BPOS continues to trail other rivals, namely Google Apps, which offer office productivity applications as a default component of their broader cloud-based collaboration and communication suites.

"We'll certainly be talking a lot more about Office Web Apps delivered through BPOS as part of future capabilities of BPOS," said Betsy Webb, general manager of Microsoft's Online Services division, in a phone interview.

Office Web Apps offers hosted versions of Word, Excel, PowerPoint and OneNote that have a subset of the features found in the on-premise Microsoft Office suite.

The Office Web Apps components are described by Microsoft as "online companions" to Word, Excel, PowerPoint and OneNote, designed to let users "access, view and edit" documents via a Web browser.

Currently, Office Web Apps is available free for individual consumers as part of the Windows Live online services, and it's also a component of the free Live@EDU collaboration and communication suite for academic institutions.

Office Web Apps, which has about 20 million end users, can also be accessed by organizations that own the on-premise versions of Office 2010 and SharePoint 2010.

Still, according to Webb, Office Web Apps' absence from BPOS hasn't hurt the adoption of that collaboration and communication suite for businesses, which includes Exchange Online, Office SharePoint Online and Microsoft Office Live Meeting.

BPOS seats have more than tripled since the beginning of 2010, she said, while declining to say specifically how many BPOS seats have been sold overall. There are 40 million paid seats of Microsoft Online Services, of which BPOS is a part, she said.

On Monday, Microsoft touted several big customer wins for BPOS, including Volvo (18,000 end users), DuPont (58,000 end users), Australia's Spotless Group, Sunoco and Godiva.

Microsoft has generated good momentum for BPOS adoption, but it is far from alone in that accomplishment, said industry analyst Michael Osterman from Osterman Research.

"Microsoft is doing quite well with BPOS. Clearly, it has gained some impressive customer wins and seems to be building momentum in both the business -- including government -- and educational markets," he said via e-mail.

"That said, Google is also gaining ground with Apps, LotusLive is doing well, and Cisco can be expected to do quite well with WebEx Mail when it becomes available," Osterman added.

The use of software-as-a-service (SaaS) applications for workplace communication and collaboration is a "greenfield opportunity," so strong growth in adoption can be expected in coming years, even as most deployments continue to be on premise, he said.

An advantage for Microsoft is the familiarity of its software interfaces and tools, due to its presence in many enterprises, and the links between its cloud and on-premise software, said industry analyst Rebecca Wettemann from Nucleus Research.

"I'd expect to see a growing opportunity for companies looking to move to a more cost-effective collaboration environment to consider Microsoft in the mix because of its experience in delivering enterprise collaboration," she said via e-mail.

Gartner has noticed that Microsoft's salesforce is being particularly aggressive about getting the word out about BPOS and pushing it as part of many renewing enterprise contracts, said Gartner analyst Matthew Cain. "Microsoft has tapped a deep root of demand for cloud services with BPOS," he said via e-mail.

A downside is that BPOS is still based on the 2007 family of products, he said, adding that Gartner expects a BPOS upgrade to the 2010 versions early in 2011.

Microsoft also announced new customers for Live@EDU, including several California State University schools, the University of Montana, Northern Kentucky University, the College of DuPage, Washington University in St. Louis and Aston University in the U.K. There are now more than 10,000 academic institutions with more than 11 million end users on Live@EDU, which includes Office Web Apps, Windows Live SkyDrive and Outlook Live.

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