Microsoft Straightens Out Cloud Strategy -- Finally

Things will get rowdier for vendors of cloud collaboration, communication and office productivity applications now that Microsoft plans to unleash a take-no-prisoners assault on the market with Office 365.

By Juan Carlos Perez
Thu, December 09, 2010

IDG News Service — Things will get rowdier for vendors of cloud collaboration, communication and office productivity applications now that Microsoft (MSFT) plans to unleash a take-no-prisoners assault on the market with Office 365.

No longer tentative about offering a full suite that combines online versions of the 2010 editions of Exchange, Office, Sharepoint and Lync, Microsoft is bringing out the big guns against rivals like Google (GOOG), IBM/Lotus and others.

For some industry experts, Office 365 is proof that Microsoft has overcome its reluctance about the cloud model and its concern about cannibalizing its valuable on-premise software business.

"Microsoft is linking its crown jewels, the most valuable parts of the company's product line, and evolving them with the cloud, another sign of how serious they are about this," said Jeffrey Mann, research vice president at Gartner.

As 2009 ended, Microsoft headed into yet another year with confusingly branded and configured set of cloud-hosted office productivity, collaboration and communication suites.

Lingering as it had for several years was the question of when Microsoft would have a cloud suite as uniform, solid and successful as its on-premise productivity, collaboration and communication portfolio, anchored by Office, Exchange and Sharepoint.

Ringing in the ears of likely mortified Microsoft officials were snide putdowns by rivals like Google and sharp criticism of industry analysts charging the company with being out of touch with the cloud delivery model.

Twelve months later, things have changed.

In 2010, Microsoft delivered regular upgrades and new features for its Business Productivity Online Suite (BPOS), which includes Exchange Online, SharePoint Online, Office Communications Online and Office Live Meeting.

In the summer, in addition to Office 2010, Microsoft also introduced Office Web Apps, a hosted office suite designed to compete against the likes of Google Docs through Web-based versions of Word, Excel, PowerPoint and OneNote.

But the big whammy came in October, when Microsoft outlined the next version of BPOS, called Office 365: a full-fledged option to Google Apps and other similar cloud-based suites.

Office 365 combines the collaboration and communication elements of BPOS with Office Web Apps and, alternatively, even with Office 2010. It is the broad cloud suite that experts have predicted for years Microsoft could build -- and rock the market if priced and configured correctly.

Although Office 365 is in limited beta testing and won't be widely available until some point in 2011, its announcement changed the landscape. CIOs and IT chiefs evaluating cloud collaboration, productivity and communication suites now will have a unified alternative from Microsoft, a leading vendor of this type of software for on-premise deployments for over a decade, along with IBM/Lotus and Novell (NOVL).

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