First look at Microsoft Office 365

Network World - Microsoft might not be the first name you think of when considering enterprise cloud offerings. But then again, the company does handle 10 billion Hotmail and Windows Live messages a day and has a 15-year history of deploying and managing massive data centers.

13 cool features of Office 365

Now, Microsoft is applying that expertise to several of its popular enterprise products, including Exchange, SharePoint, Lync and Office - all brought together online as Microsoft Office 365.

Variations of the service - Enterprise, Small Business, and Education - will have different prices and features tailored to each audience. We tested Office 365 for Enterprise beta, which comes out today. The final product will officially ship later this year.

Our focus in this review was whether Office 365 provides a solid case for moving critical business functions to the cloud - along with its integrated communication and collaboration capabilities, mobile options, and IT administration functions

No storm clouds here

First, let's tackle the strategic argument. Office 365 offers predictable costs ($2 to $24 per user, per month), which can be lower than maintaining an in-house data center. The economics makes sense, especially for mid-size organizations, which often forgo security and reliability because of hardware and support costs. This also holds true for large enterprises that are spending lots of capital on redundant data centers or scaling up for specific projects - funds that could be invested in their core business.

Perhaps the biggest advantage is the potential to transform IT groups - from being hidden away managing server rooms to becoming a true business partner with internal clients. Energizer Holdings, Microsoft's first customer to go completely to the cloud, says that its technologists were freed up to work with internal business groups, consulting with them on how technology can best be applied.

Starbucks took a hybrid approach in working with Microsoft. Headquarters employees still rely on internally-hosted e-mail and other applications. Yet 17,000 employees at 8,000 retail locations depend on Exchange Online for e-mail access and a SharePoint Online intranet to access human resources and other information. No matter where or how Starbucks employees access information, the experience is essentially identical.

Experiencing Office 365

In our weeklong test, we ran a desktop setup script, and connected without problem to the Office 365 service. Depending on the licenses you choose, you can also download and install Office Professional Plus; it's not necessary for every user, but does let you perform advanced editing, such as creating intricate animations within PowerPoint presentations or work with millions of data rows in Excel.

For casual users, the Office Web Apps are convenient online companions to Word, Excel, PowerPoint and OneNote. Web Apps let you access, view, and edit documents directly from your Web browser.