Update: Microsoft makes big cloud move with Office 365

IDG News Service - Microsoft made its long-awaited move to package the hosted version of Office with the hosted versions of Lync, SharePoint and Exchange with the unveiling on Tuesday of Office 365.

Office 365, scheduled to ship next year, is now available in limited beta form in 13 countries and regions and includes Office Web Apps, Exchange Online, SharePoint Online and Lync Online.

Office 365 for companies with fewer than 25 employees will cost US$6 per user per month. For larger organizations, Microsoft will offer additional options, including for the first time the on-premise Office Professional Plus on a subscription basis for $24 per user per month, along with the other suite components.

Larger organizations can sign up for some accounts that start as low as $2 per user per month for a bare-bones option of basic e-mail for employees who only need that functionality, as well as for more full-featured accounts, such as the one that includes Office Professional Plus, for other types of employees, such as knowledge workers and executives.

The beta program will be expanded progressively beyond the initial several thousand companies testing it.

Later, Office 365 will also include Microsoft Dynamics CRM Online, and an Office 365 version for educational institutions will also be released next year and will be an upgrade to the Live@edu hosted collaboration and communication suite.

Office 365 is the next version of the Microsoft Business Productivity Online Standard Suite (BPOS), which includes the hosted versions of Exchange 2007, SharePoint 2007 and Office Communications Online but not Office Web Apps.

The hosted versions of Exchange and SharePoint in Office 365 will be based on the 2010 edition of their software, while Lync is the next version of Office Communications Server, and Lync's online version is an upgrade to Office Communications Online.

"Office 365 is based on the 2010 wave of technology, so across the board we'll be introducing great new capabilities to our cloud services," said Betsy Webb, general manager of Microsoft's Online Services division, in a phone interview.

"This will be a significant step forward for customers of all types," she added.

Office 365 will also act as a unifying brand and unifying technology base for the various cloud-based suites Microsoft has developed in recent years, such as BPOS, Office Web Apps and Live@edu.

"This clarifies some brand confusion," said Guy Creese, a Gartner analyst.

Overall, Office 365 will offer hosted productivity applications -- word processing, spreadsheet and presentations -- e-mail, calendar, contacts, instant messaging, Web meetings, videoconferencing, intranet and Web site creator tools.

Office 365 also comes with a 99.9% uptime guarantee and access via a variety of browsers, computers and mobile devices, including iPhones, Android, BlackBerry and Windows Phone.

At first glance, Office 365 seems a stronger competitor to hosted rival communication and collaboration suites like Google Apps that have in recent years put significant competitive pressure on Microsoft.

"From a competitive standpoint, this helps Microsoft against Google," Creese said in a phone interview.