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September 29, 2005 10:01 AM

Post-Reorg Microsoft Readies New Services



As the dust from Microsoft Corp.'s latest reorganization continues to settle, one thing is evident: Microsoft is intent on turning its long-term dream of selling software as a service into reality.

Last week, Microsoft made no bones about the fact that it is planning to field a full lineup of consumer and business services across all three of its newly minted divisions.

In fact, Microsoft already sells a number of such services, both paid and free, ranging from Xbox Live to MSN Spaces blogging service. Microsoft officials have hinted at other potential offerings in the pipeline, including both consumer and enterprise versions of the Windows OneCare hosted security services, as well as a hosted Microsoft CRM service, akin to what Salesforce.com sells today.

But there are even more Microsoft services in the wings that the company has yet to detail publicly. Among those closest to commercialization: A new small-business bundle of VOIP (voice over IP), instant messaging and data conferencing about which Microsoft has discussed privately with some of its partners, as well as a managed, high-availability Exchange Server offering.


According to partners, who requested anonymity, a hush-hush Microsoft team known as the Unified Communications Services group is working on the hosted SMB (small/midsize business) bundle. The offering will likely include e-mail, unified messaging, instant messaging, VOIP and data-conferencing capabilities all rolled into a single, hosted collaboration suite, partners said. A "smart personal agent" is central to the pending offering, as well, partners added.


Microsoft plans to target the offering at SMBs who are interested in an integrated communications experience that will be managed by others — most likely Microsoft partners, or maybe even Microsoft itself — partners said. Microsoft will pitch the hosted bundle as an easy way for smaller companies to enjoy features such as intelligent call routing, auto-attendant voice response, and the like.

When asked about the hosted collaboration suite, a company spokeswoman said, "While Microsoft believes that businesses both large and small can benefit from unified, real-time communications we don't have a product as you describe to announce at this time."

Microsoft executives have been willing to discuss, to some degree, Microsoft's plans to field managed services. Company brass have acknowledged the existence of a hosted desktop deployment/management service, code-named "Energizer."

When word of Microsoft's pilot program for providing IT services to battery maker Energizer Holdings first leaked out in March of this year, Microsoft spent a lot of time trying alternately to calm and warn its service-provider partners about Microsoft's intentions to get more into the services space. Earlier this summer, Microsoft officials said they had yet to figure out pricing, packaging and distribution plans for the Energizer service.

But company officials did confirm at the company's annual partner conference this summer that Microsoft Consulting Services (MCS) is planning to field a number of packaged service SKUs before the end of calendar 2005.

Kevin Johnson — formerly Microsoft's group vice president of worldwide sales, marketing and services, and now co-president of the new Microsoft Platform Products & Services Division — told Microsoft Watch in July of one other likely managed service offering on the docket. Johnson said Microsoft was strongly considering some kind of Exchange services bundle that would include bits, services and methodology for helping users to manage Exchange at a "four nines" (99.99 percent) availability level.

Such an offering would consist of a number of pieces, among them a discovery SKU and a configuration SKU, Johnson said. And he hinted there might be another managed service SKU around SharePoint Portal Server in the works.

"MCS will deliver these [SKUs] to partners," Johnson said, and encourage them to bring them to market.

There are plenty of other areas where Microsoft is likely to make some kind of a software as a service play, said Burton Group senior analyst Peter O'Kelly.

O'Kelly said he wouldn't be surprised to see Microsoft field more services designed to "bridge [the] 'digital lifestyle' and 'digital workstyle' contexts" so as "to provide a more seamless experience for individuals as they juggle their personal and work-related information resources and communication tools."

(This article includes information which originally appeared in the July 11, 2005, and Sept. 7, 2005, issues of the Microsoft Watch newsletter. Want to see what other Microsoft news nuggets you might have missed? Sign up today for a free two-week trial subscription to Microsoft Watch.)

Note: This story was updated to include a comment from Microsoft on the SMB collaboration service, as detailed by Microsoft partners.

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