Microsoft Office 365: Cynical rebrand or future of collaboration?

What is it really, and why should you care?

Office logo (Microsoft)

This week Microsoft announced its Office 365 initiative. What does it mean for businesses, large and small? Some have described Office 365 as a rebranding exercise. But that's not really it. Others would have you believe that it's "Office in the cloud." But that not quite right, either. So what is it, and why should you care? Firstly, it's a program to tidy up a collection of Microsoft brands into one super-brand. Now Microsoft hasn't had a stellar reputation for coherent branding recently. It seems that its attempts are either:

  1. applied inconsistently (e.g., the spate of "Live" products),

  2. meaningless (what is "Forefront" supposed to mean?), or

  3. just plain confusing ("Exchange hosted services" is not the hosted service running Exchange!)

Microsoft is taking the hosted Microsoft Online Services (MOS) products -- which many are incorrectly calling BPOS -- and integrating other technologies. Also being rolled in is the service for the education market, Live@Edu, and the Office Live Small Business web presence kit (there's that "Live" moniker again). Communicator and the generally awful Live Meeting are getting replaced with a "new" product, called Lync, and Office 365 will include a MOS component called (surprise!) Lync Online. Second, the company is adding a new SKU of Office: Office Professional Plus. This is a subscription offering, which gives users the latest version of Office on their PCs, plus the right to use a cut-down, cloud-hosted version from "any" web browser. It also includes some neat-sounding collaborative editing features, plus streamlined integration with hosted MOS features like SharePoint Online. All major smartphone platforms are supported to some degree, but Windows Mobile 7 gets the richest functionality level, including synchronization of SharePoint workspaces. So why is Microsoft doing this? The cynic in me says that changing all the product names and altering the bundles from time-to-time is a great way to confuse customers into buying more than they need. Confusion can cause customers to choose a more expensive SKU than is required. The less facetious answer is that Microsoft is coming under increasing competitive pressure from Google Apps. Even if customers are merely waving the Google Apps banner as a negotiating position, the channel and Microsoft sales reps can find it surprisingly hard to counter with a coherent message. Because the current Microsoft offerings are so fragmented, in branding terms, sales-people have to assemble a laundry list of products and services to compete with the simple, two-word phrase, "Google Apps." That can cause higher discounting, or even lost sales -- both of which lead to lower commission checks for the poor sales rep. This is the real reason for the marketing push we saw this week. Everything else just comes along for the ride. Speaking of confusing product structures, there are several different editions of Office 365, ranging in list price from $2/user/month to $27. They include:

  • Office 365 for Small Businesses
  • Office 365 for Enterprises
  • Office 365 for Enterprises (with Office)
  • Office 365 for Enterprises (with Office and Lync)
  • Office 365 for Enterprises (kiosk workers only)
  • Office 365 for Government
  • Office 365 for Education
  • Office 365 for Education (K-12 plan)

But don't expect Office 365 until mid-2011, by which time some of these details may have changed...  

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