Microsoft Readies Windows Server 2008 Foundation

Steve revealed the new software during a Feb. 24 meeting with financial analysts. Stupid me, I didn't make the competitive connection: IBM's Lotus Foundations. Windows Server 2008 Foundation and Lotus Foundations target the same market segment: small businesses. Oh, yeah, IBM's server appliance runs Linux.

GOT A TIP OR RUMOR?

According to the channel marketing/promotional material I received: "Windows Server Foundation is an alternative to running open source (Linux) software."

Apparently, Microsoft already has salespeople promoting the new software—and there already is some small business confusion about Foundation versus Foundations. It's a tried-and-true strategy for Microsoft, which has used similar naming before. Personally, I hate similarly named products, but it's a practice widespread beyond Microsoft. Some Microsoft examples: Word, which took on WordStar and WordPerfect.

Similar naming convention causes product confusion, which can benefit something competing against something established. In this case, the upstart is hard to identify. Months-old Lotus Foundations competes against established Small Business Server. Perhaps Microsoft execs want to protect their turf against the IBM upstart. So it's the new versus the new.

I just have to digress, going on more about how effective can be similarly named products. Film studio The Asylum specializes in like naming for which it gains DVD rentals or sales. The misnaming is quite the successful business. Have you heard of these titles: "Snakes on a Train," "Transmorphers" or "The Da Vinci Treasure," playing off major studio releases "Snakes on a Plane," "Transformers" and "The Da Vinci Code"?

Microsoft has good reason to confuse customers. Lotus Foundations is an affordable Small Business Server alternative. SBS is a more managed approach, while Foundations, being an appliance, is more plug and play. Of course, both kinds of products have their place. Based on the marketing material, Windows Server Foundation requires less IT staff management.

It's my understanding that Microsoft's Server Foundation product comes out of the Small Business Server group. As aforementioned, I received through a reliable tipster what appears to be product information previously distributed to the channel. But I certainly hadn't heard about an official product announcement. So this afternoon I contacted Microsoft's PR agency about Windows Foundation Server, thinking that perhaps I had missed the announcement; I wanted pricing. I was offered embargoed information, which I rejected, already having received other information. I have to take that as meaning Microsoft hasn't formerly announced the software or pricing.

Interestingly, the Microsoft documentation compares Foundation to Windows Server Standard rather than Small Business Server. Windows Server Foundation must then be a subset of Windows Server 2008 rather than SBS. Some key differences between Foundation and Standard:

• 64-bit only, whereas Server Standard also comes in a 32-bit version
• No virtualization, whereas Server Standard comes with one license
• 15-user limitation, which means Microsoft's target market is the very small business
• Routing and Remote Access and Terminal Services Gateway are each limited to 50 users compared with 250 for Server Standard
• Internet Authentication Service is limited to 10 users, versus 50 for Standard Server.

Windows Server Foundation is less than I expected. I had speculated that Microsoft would strip down features, using the existing "core" approach, to offer software specialized for different small business tasks. Instead, Microsoft has changed licensing terms, simply turning off broader capabilities available in higher-end Windows Server 2008 versions.

According to the marketing material, the software will be preinstalled on servers, which insinuates that there will be no boxed software. Microsoft's key message to resellers:

Server Foundation provides organizations with the foundation to run popular business applications. It's an affordable platform for core IT capabilities, including file and print sharing, remote access and security features. A familiar Windows experience makes it easy for organizations to get up and running.

Among questions the Microsoft sales material suggests that they should ask:

• Do you have cost-conscious, small-business customers?
• Do your customers want genuine software at an affordable price?
• Do your small-business customers need to print, share files and connect to the Internet?
• Do you want to optimize your existing investments in Windows Server to sell to more customers?

There are questions I still can't answer about Windows Server Foundation:

• Will it be installed on an appliance, like Lotus Foundations?
• Will Microsoft bundle productivity and message applications?
• What will a Windows Server Foundation system cost?

Based on information available to me, I must regard Server Foundation as a competitive response to Lotus Foundations and other Linux server software. The tweaked licensing terms tip off Microsoft's intentions, as do the licensing terms allowing easy upgrades to Windows Server Standard. Microsoft already has a very good product for the target market: Small Business Server. Does it really need another?

[Please send your tips or rumors to watchtips at gmail.com.]