Microsoft discusses its online services push

Microsoft has fleshed out details relating to its online services offerings to customers and partners attending its annual worldwide Partner Conference in Houston.

The services, first launched in September last year, will be available from the beginning of 2009 for UK customers, Microsoft said.

Enterprise customers will be offered the Business Productivity Suite, a subscription service encompassing a range of Microsoft software, including: Exchange, Dynamics CRM and Office (SharePoint, Communications, and Meeting), at a price of US$15 per user, per month or US$180 a year. Customers will also be able to subscribe to each service independently for a lower cost.

The charge contrasts to Google’s already available competing product, Google Apps Premier, priced at US$50 per user, per year.

But it seems Microsoft launched its higher priced services at the right time, with Google’s Docs and Spreadsheets experiencing problems this week for nearly one hour when customers were unable to access the cloud based applications.

“Google Apps is relatively new and so of course it will experience some downtime problems but the fact that Microsoft launched its online offerings at the same time is good for Microsoft,” said Redmonk analyst James Governor.

Microsoft revealed an alternative package of online services for “deskless workers”, a term Microsoft uses to describe workers that are not always hooked up to a computer, such as shop floor workers.

The Deskless Worker Suite will include Exchange and SharePoint software for a cost of US$3 per user, per month.

Governor pointed to large customer wins Google has recently made, for example Australia state New South Wales has recently switched from Microsoft Exchange to Gmail.

But Governor did believe when Microsoft started to deliver on its online service strategy, it would be aggressive.

“It will be Microsoft’s channel partners that really suffer,” he explained. “Because customers will buy directly off Microsoft,” he added.

Microsoft is offering its partners certain compensations. Partners selling either of the two suites will receive 12 per cent of the first year contract price and six per cent of the subscription fee ongoing.

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