Microsoft Corp. (NASDAQ: MSFT ) established itself as the industry’s desktop software giant by selling operating systems and applications installed directly on a user’s hard drive. The company’s Office 365 cloud application platform instead offers hosted applications accessible online, but Microsoft sees new opportunities for both small and large businesses in its cloud product rollout.
In an interview last week, Microsoft’s Eron Kelly, senior director for business online services marketing, emphasized how Office 365 actually can expand the company’s reach.
“Certainly small and medium[-size] businesses see the value of [Office 365], because today they really just don’t even have access to this technology. They don’t have the skills internally to run it. But larger enterprises are seeing the value too,” Kelly said.
Office 365 was announced last month and is due to be generally available next year. It features cloud-based versions of applications such as Exchange messaging, SharePoint collaboration, and the Lync communications server.
Larger customers such as Starbucks, Home Depot, Coca-Cola Enterprises, and Volvo are finding email and desktop collaboration tools to be mission-critical but not differentiating, Kelly said. Large user sites do not want to spend “internal human capital” on these applications but do want to be as productive as possible. They can take advantage of economies of scale via the cloud service, said Kelly.
“In the enterprise, there are more people that now have access to our technology because of the business model and the [cloud] delivery. In mid-market there’s more customers that actually have access to our technology, but now they don’t have to buy a bunch of servers. And in small business there are people that never had access to our technology outside of Windows and Office that now can get SharePoint, Exchange, and Lync for a few bucks a month.”
Kelly noted Office 365 will feature the latest versions of Microsoft’s software. “This is Exchange based on the 2010 product. This is SharePoint based on the 2010 product. This is Lync, which is the next generation of Office Communication Server. So we’re going from the ’07 products to the 2010 products for the workloads.”
At some point, Microsoft will offer online CRM as part of Office 365.
Mobile devices can access Office 365 via Microsoft’s ActiveSync technology. Windows Phone 7 will access Office 365 via the Office Hub capability for linking to email and other applications. Multiple browsers, including Firefox and Chrome, are being supported for Office 365 access.
Business partners are being enlisted to help move users from an existing environment into the cloud, performing operations such as mailbox moves. Accenture was cited as a key partner.
At this juncture, Office 365’s administrative, commerce, and end-user portals are built on Microsoft’s Windows Azure cloud platform. Over time, Office 365 core applications will leverage it as well, Kelly said.