Microsoft Signs XL Capital As Second Managed Services Customer

Microsoft has named XL Capital as its second paying managed services customer.

The Redmond, Wash. software giant's deal with the multi-billion dollar insurance, reinsurance and financial services giant was signed this week, Microsoft said. Financial terms of the deal were not disclosed. XL Capital has almost $60 billion in assets.

As part of the deal, Microsoft will offer hosted desktop and collaboration services for XL Capital and will manage 4,000 of XL Capital's desktops, said Tom Ryan, a spokesman for Microsoft's Managed Solutions.

The migration will begin in September, the spokesman said.

Microsoft named Energizer Holdings as it first paying managed services customer in 2005.

The software giant will offer many of the same services to XL Capital that it currently provides to Energizer including desktop PC services, e-mail and collaboration services, application testing services and second-tier help desk services.

The intent is to reduce the operating cost for each desktop deployed, reduce the costs for each email account issued and increase the number of PCs that can deployed in a day, Microsoft said.

At Microsoft's management summit last month, Ron Markezich, CIO and vice president of managed solutions at Microsoft, told CRN it would sign two more paying customers -- a financial services company and a conglomerate –in 2006.

XL Capital is that financial services company. XL operates in 29 countries and employs roughly 3,600 in 78 offices worldwide. It was founded in 1986.

Microsoft's interest in managed services – also dubbed managed solutions -- sparked a bit of an outcry from both SMB solution providers and large systems integrators who built managed service platforms to serve their customers.

Since that time, the Redmond, Wash, software giant has tried to appease that concern by noting that it only plans to offer managed services for only a handful of very large customers.

Microsoft claims its managed offerings are products rather than services because the goal is to develop a mass volume desktop model that can be deployed universally rather than a custom desktop managed desktop service for individual customers.

By hosting e-mail, collaboration and Windows desktop services, Microsoft -- and its partners -- can provide a viable off-premise solution at lowered costs.

Partners will be authorized to resell and add value to the services but the channel model has not yet been worked out, Microsoft said.