Microsoft Targets Web-Based Services For Enterprises

In the coming months, Microsoft will roll out "Live" and "Online" service offerings, with the former aimed at consumers and small businesses, and the latter at larger businesses.

"Online" services are essentially a re-branding of the existing Exchange, Office SharePoint and Office Communications Online services Microsoft was already offering through a shadowy two year old incubation program called Microsoft Managed Solutions.

Microsoft will allow customers to access services in three ways: on-premise, hosted in the cloud by Microsoft, or hosted by a VAR, said Eron Kelly, director of product management in Microsoft's business online services group.

The distinction between Live and Online was made in response to larger businesses asking for better articulation of the vendor's services strategy, Kelley said.

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Online services are designed for organizations of 5,000 users or more that have more advanced technology needs, says Kelly. "It's all about making life easier for IT decision makers with compliance, data control, and reliability services," he said.

Within the Online umbrella, Microsoft is delivering so-called 'finished' services, or complete end to end solutions that end users can use immediately; 'attached' services, which are added to existing on-premise deployments, and "building blocks," a service oriented architecture-based approach for developers that want to build applications that take advantage of services being hosted by Microsoft, according to Kelly.

In the partner-hosted model, solution providers sell services through monthly subscriptions to end users, and pay licensing fees to Microsoft through the Service Provider Licensing Agreement (SPLA).

"We continue to see the opportunity for partners to host our technology and provide that to customers. In fact, many customers are specifically asking for that," said Kelly.

Mike Ritsema, president of i3 Business Solutions, a Microsoft Gold partner in Grand Rapids, Mich., isn't thrilled by Microsoft's new services model, but understands why the vendor is moving in this direction.

"I don't like it, because I'd prefer a pure business partner play and channel strategy around services. MS becoming a competitor is a concern for me, but it's the reality," said Ritsema.

Other partners welcome the ability to offload some functions to Microsoft because doing so frees them up to focus on more strategic, high value tasks.

"Whether something is premise based or in the cloud, partners still have to help customers with the strategy, and I'd rather do that than sell a SKU or a given backup product," said Ric Opal, vice president of PetersAssociates, a Oakbrook Terrace, Ill. "If we can take features and functions that are more commodity focused, that leaves more budget and time for me to do strategy work."

"The pros outweigh the potential cons by a long shot," agreed Tyler Roye, senior executive officer at MindSHIFT, a Fairfax, Va.-based solution provider.

"There's a need in the marketplace for a higher level of hands on support for the kinds of managed solutions that Microsoft is likely to provide under their own roof. That includes integration and delivery of other utility solutions that go beyond what Microsoft delivers," said Roye.

Microsoft on Monday also re-branded its Office Live collection of small business focused services as "Office Live Small Businesses."

In addition, Microsoft opened pre-registration for the beta version of Office Live Workspace, an online version of Microsoft Office the vendor plans to launch later this year that lets users access documents and collaborate with other users over the Web.