Early next year, Microsoft will deliver European business users a late Christmas offering in the form of Exchange and SharePoint Online. Will they be tempted by the promise of fresh applications served up directly by their creator or will such gifts be spurned at a time of recessionary conservatism?
The Redmond giant rolled out its self-hosted Exchange and SharePoint Online services before the Yuletide rush in the States last month. They should not be confused with its free Office Live suite of Google-baiting apps. The Online range, which includes a software-as-a-service release of Dynamics CRM, is aimed squarely at bigger businesses.
Last week, Stephen Elop, president of Microsoft's business division, told analysts that
within two weeks of the U.S. launch of Exchange and SharePoint Online, 10,000 customers had signed up. More than half a million seats of Exchange Online, SharePoint Online and Office Communications Online were already in the bag. And even though the service has yet to be officially launched in Europe, he said that Danish shipping giant Maersk was already moving "tens of thousands" of users to Exchange Online.
Elop claimed that within five years, half of Microsoft's CRM, Exchange and SharePoint revenues will come from its Online services, which would make it a cloud computing cruiserweight as well as mind-boggling amounts of money. Quite what the reaction to this forecast will be from its legions of existing hosted service partners remains to be seen.
One man who is taking a keen interest in take-up on both sides of the Atlantic is Barry Jinks, president and CEO of Canada's Colligo Networks. Colligo was first out of the starting blocks to back Microsoft's Online strategy with support from its Contributor rich client for SharePoint and Outlook Add-In tool. Jinks says that over 60% of Colligo's enquiries come from Europe. He thinks bigger businesses are ready to make the ideological jump from their own server set-ups to Microsoft's own "industrial strength" service.
"We see more and more companies treating their IT infrastructure as a consumable service and essentially internal IT departments are now competing with external suppliers for the lowest cost provision of that infrastructure," he says. Microsoft is up there with other major players in the cloud/utility computing space such as Google and Amazon, says Jinks, in putting such a large and scalable IT infrastructure onto the web as a service.
"The business model is essentially scaled. They scale it up and they can get good dollars per megabyte or gigabyte because they’re amortising that across a much larger install base than an individual company can provide," he says, pointing out that only very large organisations can provide comparable IT operations.
"Now, is it going to replace the IT infrastructure at something like Siemens? I doubt it," he says. "But would individual departments, individual countries or divisions go onto it? Well they would go to central IT and say: 'What is it going to cost for SharePoint per user per month?' and 'What is it going to cost me to get that externally hosted?' And they’ll do a price comparison and if, in fact, SharePoint Online is cheaper, they could well go with it. So I think it’s purely a cost issue and the beauty of it, of course, is that it’s like a tap; you turn it on and it’s there available tomorrow."
Colligo Networks beta-tested Microsoft's SharePoint and Outlook Online services and Jinks says his firm was up and running with the applications in "a matter of hours". Rapid implementation could be as important as cost when firms weigh up the new offerings.
"So rather than having to go through the requests of: 'Oh well, we want to get SharePoint' and then 'OK, fine. Well, that’s going to be three months ", you can say: 'Fine, I’ll buy it tomorrow and I’ve got it and it’s working and, you know, it’s price competitive'," he says. "In some cases maybe not, but speed is important so there’s a lot of reasons why [big] companies may want to go to this rather than just very small ones."
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