Microsoft's SBS Plans

As Linux ISVs prep back-office servers for the small- and midsize-business crowd, Microsoft is mulling a "lite" version of the forthcoming Small Business Server (SBS) 2003, priced at less than $1,000.

For more than a year, Microsoft's next version of SBS, code-named Bobcat, has been the subject of heated internal debate about the product's components and pricing, said sources close to the company.

The current plan is to get the price to less than the "magic" price point of $999 and include Windows Server 2003, the forthcoming Titanium version of Exchange, SharePoint Team Services and fax-sharing capabilities, sources said. Microsoft also is mulling two versions of SBS 2003, sources said.

>> SBS 2003 has been the subject of internal debate about product components, pricing.

SBS 2000 currently includes Windows 2000 Server, Exchange 2000, SQL Server 2000, shared fax and modem services and a five-user license for $1,500.

Beta 2 of SBS 2003 shipped in December without SQL Server or Internet Security and Acceleration (ISA) servers, sources said. Microsoft may drop SQL to reduce costs and cut ISA because of potential security breaches with Internet Information Services in the Windows 2003 Server, sources said.

"SBS [Beta 2] shipped near Christmastime, and it's starting to shape up what the product will look like. The SharePoint Team services will give resellers and VARs a way to engage the client and share documents," one beta-tester said.

While Bobcat's components aren't finalized, another partner said he isn't sure the current plan is the right one. "From [a partner's] view, SQL didn't have much value to the SBS customers. ISA, on the other hand, does have tremendous value in an SBS environment," the partner said. "I think it is a mistake to drop ISA. I do not see that a under-$1,000 SBS without ISA has much value. [It's] especially true in the current environment because I can get them under $1,000 with a channel rebate if that's important," the partner added.

In the interim, Microsoft said last week that it plans to extend its $500 rebate on SBS 2000 through June 30. The rebate was slated to cease at the end of this month.

One solution provider said the deal has enabled him to offer better services and snag new clients.

"The SBS extension and the rebate program in general is the greatest thing since sliced bread," said Michael Cocanower, president of solution provider ITSynergy, Phoenix. "I have unquestionably sold more SBS because of the rebate."