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IDG News Service - IBM has launched LotusLive iNotes, an on-demand e-mail, calendaring and contact management system meant to compete with the likes of Google and Microsoft, the company said today.

Pricing starts at $3 per user per month, undercutting Google Apps Premier Edition, which costs $50 per user per year.

IBM is aiming the software at large enterprises that want to migrate an on-premise e-mail system to SaaS (software as a service), particularly for users who aren't tied to a desk, such as retail workers. It is also hoping to win business from smaller companies interested in on-demand software but with concerns about security and service outages, such as those suffered by Gmail in recent months.

LotusLive iNotes is based on technology IBM purchased from the Hong Kong company Outblaze.

"What we brought to Outblaze and to the marketplace is what you'd expect from IBM in terms of security, reliability and privacy," said Sean Poulley, vice president of online collaboration.

While alluding to Google's service outages, Poulley acknowledged that no company can guarantee 100% uptime for on-demand applications. But IBM has a long-standing track record of running "the world's mission-critical systems," he said.

IBM will also have an opportunity to win customers from Microsoft who aren't ready to migrate to the upcoming Exchange 2010 release, given the headaches and investments involved, Poulley said.

Overall, the main point of interest in IBM's announcement is price, said Gartner analyst Matt Cain.

"Outblaze always sold low-cost mailboxes and that's what this is," he said. "Google's long been in it, Microsoft's long been in it. Now IBM's in it."

However, that's not to say IBM's brand on the software isn't of some value, Cain added. "From an enterprise perspective, you'd rather buy e-mail from IBM than a company called Outblaze."

It's unlikely that IBM's pricing strategy will cause competitors to lower fees for their offerings, according to Cain. For one thing, Microsoft already has a $2 per month Exchange Online option called "Deskless Worker," Cain noted.