Microsoft aims to be a good host
Tim Tisdale, CEO of Atlanta-based ThoughtBridge, explains how his company is using Microsoft Online as part of an "HR in a box" service it sells to businesses.
(Credit: Ina Fried/CNET Networks)SAN FRANCISCO--For perhaps the first time in its history, Microsoft made the case on Monday that businesses shouldn't run its software. Instead, Microsoft argued that corporations should let it run the software for them.
During the past several years, Microsoft has been testing out the idea that it can host and run business software cheaper and more effectively than individual enterprises can do on their own. The effort started in 2005 with a single customer--battery maker Energizer--which had Microsoft essentially handle all of its PC desktops.
Over time, Microsoft narrowed the service to an option in which it hosts Exchange and SharePoint, runs the software in its data center, and charges customers on a monthly basis. Microsoft officially launched the products, known as Microsoft Online, at a customer event at the St. Regis hotel here.
"We can help you save money," Microsoft Business Division President Stephen Elop told the crowd, saying Microsoft estimates that companies can save at least 10 percent by letting Microsoft run their messaging and collaboration software for them.
One of the early customers is video retailer BlockBuster, which has been using Exchange Online for about six months. Blockbuster CIO Keith Morrow said in an interview that Microsoft's online services came at a good time for the company, which was on a several-generations-old version of Lotus Notes.
Morrow said the video rental company needed to make a change of some kind, and the option to move to Exchange without having to bring that skill set in-house was a key selling point, as was the ability to offer better mobile options, including Outlook Web Access and iPhone support.
Another Notes switcher in the crowd was Eddie Bauer, which has been a Microsoft Online customer for about five weeks. Chief Information Officer Rich Mozack said the clothing retailer wanted to move off Notes but couldn't make the numbers work to run Exchange on its own.
"We just couldn't justify the up-front investment," Mozack said.
Microsoft's Ron Markezich said about two-thirds of early customers are moving from Notes to Exchange. But even as Microsoft continues to target those moving from Lotus Notes, the company faces the threat of its own Exchange customers moving to other hosted options, including Google Apps.
Just last week, Serena Software said it was switching to Google from Exchange in a move it said would save it $750,000 a year, according to several reports.
At the event, Elop made Microsoft's familiar case that, while the cloud is great, customers are better served by an option that allows software to run on customers' own machines as well as over the Internet.
Elop said Microsoft is adding thousands of servers to its data centers every month. Although Microsoft Online is initially aimed at Exchange and SharePoint, the goal is to offer a hosted option for all of Microsoft's server software.
"We expect all of it be available in this way in the near future," Elop said.
The software maker said last year that it would offer the hosted option for large businesses, later expanding the offer to businesses of all sizes. At last month's Professional Developer Conference in Los Angeles, Microsoft also confirmed that it would offer Web-based versions of its Office applications, including Word, Excel, and PowerPoint.
While many of those at Monday's event were the company's early customers and partners, not everyone at the event was ready to sign off. I spoke with a municipality that was highly interested in Microsoft's product, particularly as it plans to move from GroupWise to Exchange. Still, with a dearth of other governments to point to, this CIO told me that he still faced challenges in getting the city's upper management and government to sign off on the deal.
During her years at CNET News, Ina Fried has changed beats several times, changed genders once, and covered both of the Pirates of Silicon Valley. These days, most of her attention is focused on Microsoft. E-mail Ina. 
I find it curious that MSFT is casting about for new ways of pushing the old SaaS chant. It's like tablets with them - a niche product that has little appeal, yet they preach it like it were the Second Coming.
"During the past several years, Microsoft has been testing out the idea that it can host and run business software cheaper and more effectively than individual enterprises can do on their own."
Sorry, but there's a disturbing lack of flexibility in such a solution. You're stuck with pricey MSFT products in a homogeneous environment, which does not allow for innovation at all. You don;t want to push to Vista? Too bad - you're getting Vista anyway, and you'd better like it.
Last week you wrote that "Linux has the best device driver support in the world, much better than Windows".
Before that you had said that "Linux is more user friendly than Windows and Mac OS X."
Almost in all your comments you mention that "Vista sux".
For readers, just search ANY post about Microsoft. You will see a similar hate-post from Penguenisto.
I am just curious. Where does that baseless hate come from? Do you work for Apple or an open source vendor? Why do you spend all your time posting stuff like that? Do you think anybody cares?
Ad-Hominem gets you nowhere. Please stick to the facts and topics at hand, if you can find that to be possible.
Thx,
/P
Go Google.
Based on your logic, any company should make only 1 product and neverventure into other product areas because they would be evil? Great logic. If company A create something and company B comes along and makes something that the majority of people find better then does that make company B evil?
Is Apple evil for coming along and creating a phone that uses touch and taking business away from everyone else? Is Google evil for getting in the browser makert?
The majority of people in the world are choosing to use MS products, that is fact. They are using them for some productive reason else they have the ability to choose other options. I know we talk about Vista a lot but how many XP users are jumping over to Macs; some - yes but not a large number...
@ Penguenisto
For any business to survice they have to find ways to make money. The flexibility you speak of is not needed for the majority of people. Refferring to the article, these IT deparments are getting what they need. They are going to this option becuase they do not need to be flexible.
And if you think that a MS environment stops innovation then you really have a clouded view
Re: "[...In November, 1994, OS/2 Warp 3.0 was released. It was the first PC operating system to have built-in Internet support. At the time, OS/2 critics said that Internet support was just "more geek crap," but today every major operating system ships with built-in Internet support. The release of OS/2 Warp Connect followed, and included full network support out of the box for all the major protocols, including IPX, TCP/IP, and NetBIOS. At this point, the focus for OS/2 became the "networked computer." When Windows 95 was released in August, 1995, resellers reported record sales on OS/2, as many people saw how Microsoft's hack didn't quite cut it for real-world, mission-critical usage....]"
http://www.os2bbs.com/os2news/OS2Warp.html
Despite your attempt to attack Microsoft over this, you didn't mention Google or Apple which have the exact same issues. Please be sure to paint everyone with the same brush of ignorance in the future.
As for flexibility of solutions, I suppose this means you aren't familiar with this OS called Linux? It can connect to the same services that Microsoft is offering. There is no need to use Microsoft only clients to connect. If you looked into the subject you are mindlessly (and I do use that term correctly) attacking, then you would have realized this.
Ignorance is your biggest enemy here. Arm yourself with knowledge of the subject and you can avoid this sort of thing in the future.
"Ad-Hominem gets you nowhere. Please stick to the facts and topics at hand, if you can find that to be possible. "
Ironic that you would give this very advice that you so commonly fail to follow. It somewhat derails any credibility you might have in making such comments.
@jim429: Lay off him. He's got as much of a right to spout gibberish as anyone else. If he chooses to appear to be an ignorant fool, then that is up to him.
@JasonCe: Penguinisto has a history of his bigotry towards Microsoft. He also has a history of changing his story a lot including his job, his accomplishments, and even what OS he uses. For fun, go look on Slashdot. His comments are even more outlandish there.
/P
And please don't bring up the training argument. It's only predicated on 2 factors: 1, people don't want to learn, and 2, people can't learn. If you've got a work force like that, you did some very poor hiring.
All it does is play into the argument that you have a bunch of IT folks with a narrow knowledge range trying to hang on to their jobs.
A quick Google will bring up more rebuttals to this myth than I can list here.
I know some folks like Penguinisto believe that Apple's OSX is only suitable for 'consumer use' as he said and not for professionals, but this could really help to bring Apple into the business market as a desktop. It could only help Linux adoption in the desktop area as well. We're moving more and more into the client/server model- or rather returning to it actually.
Anything that opens the enterprise up to Apple, Linux, and other options has to be a good thing.
You're entitled to your opinion. I frankly can't stand Apple. I love Linux, but rarely use it. But I love the concept and the idea behind it. I hope it gains native support from Adobe, Microsoft, etc.
That being said, I use Windows because I feel it is the only OS that actually gets the job done 100%. I love the concept of the cloud. I already use GMail, Google Calendar, and SalesForce. I have a few spreadsheets on Google Apps that I use for quick calculations from anywhere. But I still use Word, Excel, Illustrator, Photoshop, Quark, and other tools that I feel work best on a PC with Windows and Office integration.
I do understand why many hate Microsoft. Once I was trying to activate Office and Microsoft claimed my copy was a fake. I explained that not only was it not a fake, but I so happened to have bought it online from Microsoft themselves from their own online store. And I got the license, backup disc, and email with activation code to prove it. I got to fedup I ended up just installing Open Office. And I was so glad that Open Office even existed. It gave me a free good office app to use for a while. A few days later Microsoft called me to apologize when they realized the mistake they had made. Even though they did call me, which I do appreciate, I still yelled at them something awful. I explained how we who buy software are at the mercy of those who hold activation. If for any reason they choose not to activate it, we're just screwed. The reality is, it's a pain. Adobe is no better. Actually worse in my opinion. I don't like the activation schema one bit. And for that reason, I sure hope Linux and OpenSource win in the end. But what about today? I still say SalesForce pays for itself. And Office is not expensive considering what I get out of it. It cost me $399 each time I buy a standard license. But I do so much with Excel. I do so much with Word. Both have made me money, and to be fair, I am okay with everyone winning. I just don't like the activation thing. I like the freedom of Linux, but I have to admit, I "need" windows.
Alex
It does require some skill to configure those servers, but I could hire a small army for $750K. Most organizations would only need part of a person's time. Small organizations could just hire a local computer IT services company. (Create local jobs!)
If folks prefer to remove all management of (and lose all control over) their e-mail, I guess using a cloud-based solution is OK. But, there is absolutely no way I would entrust my e-mail and backups to a third party.
Now why do I have the mental image of Penguinisto holding a sword high after defeating his enemy on a Scottish moorland?
Now why do I have the mental image of Penguinisto holding a sword high after defeating his enemy on a Scottish moorland?
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LOL. Not to worry Dan, you had created that image well in the previous paragraph. I got that image in my head too. To bad the name "Penguinisto" doesn't invoke a body image like Jessica Alba!
In Peng's defense (I'm one of the few that would come to his defense), M$ deserves most of the hatred he unleashes upon them. At least in my why-should-I-be-humble-when-you're-wrong opinion. It's the way M$ treats their customers like the enemy. If that doesn't make sense to you, read Alex's comment above. I considered him a typical M$ apologizer, but his love seems to have been tempered. I can understand, my experience with WGD sparked my admitted hatred of everything M$. I think Peng had some other sort of epiphany moment when he realized that M$ is the evil empire.
In short, there IS a reason or purpose behind the hatred and it's not blind. When your epiphany moment comes, we will welcome you out of the prison life known as winblows.
Without walls, who needs windows or gates?
I hate poor people.
Your comment is so off-base I'm not sure where to begin. RedHat makes money. Novell Makes money. Canonical makes money. Certainly the folks that install and support Linux make money. I remember IBM stating that their investments of over $1 billion into their Linux based services business made a lot of money. Certainly all of the above dip into the source code and make whatever modification needed to make Linux their own profit center. Certainly those folks have a "real job".
To the average Joe and Jane, these folks gain a flexible platform. If I were a student in college and needed a word processor, browser, music player, and so forth, Linux would cover my needs just fine.
Certainly Linux presents another model to making money that differs from commerical software. Paid support, but flixible licensing. Often I find commerical software is better. For example, I'm not a fan of GIMP. I am a fan of Photoshop. Open Office while pretty good is still not a replacement for Excel or Word for me. I don't see any true feature for feature open source replacements for Quark or InDesign either. So it does have limitations as far as I am concerned. But's it's just people who want free stuff. I'd be a lot happier if Microsoft and Adobe had more flexible licensing schemas.
I think your comments, entirely, are groundless.
Alex
Putting aside the issue of rich and poor, let's consider who uses or might use open source. I use Linux. And, you're rarely look at the source code, though I have. But, it is not open source that is of interest to me, but wide distribution and support. I can do what I need to do with Linux, whereas Windows is a lot more challenging out of the box (as a server). I do, however, use Windows on my desktop machine and would not use Linux there.
It is not entirely a function of price, but more the software, community support, etc. I choose the right tool for the job. And, for a server platform, my current preference is Linux. Prior to that, I used IBM AIX, SCO Unix, Solaris, and AT&T Unix. The world has converged on Linux -- and there are many reasons. Linux has, thus far, proven to be a very reliable platform; I have no complaints.
All that said, price is certainly a factor, no doubt. But, this has nothing to do with rich or poor. Companies making tons of money (e.g., Google) are all about open source platforms. It would not surprise me if their entire infrastructure is built on open source. It can save tons of money. They do not use it because it is crap; they use it because it is good and it's free.
But, even if it were not free, I would still use Linux or some *nix system, so long as there was good support available.
- by CooolAl December 5, 2008 11:43 AM PST
- So let me get this straight:
- Reply to this comment
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(33 Comments)1. I will pay Microsoft to host my exchange system somewhere in the world I have no physical acess.
2. Microsoft will have top quality MCSEs on staff ensuring it is always working.
3. I will never have to wait on a Q or talk to someone who doesnt understand Exchange to help me address an issue.
Yea right...my Exchange is staying were it belongs.