Searching for a Cloud Cash Cow

By Don Reisinger  |  Posted 2011-06-28 Print this article Print


5. Collaboration is king

Microsoft has done a fine job of offering collaboration through its SharePoint service. The enterprise has responded well to that. It's no surprise, then, that Microsoft has made collaboration king in Office 365. The platform supports SharePoint, and collaboration features are built in across the service. The corporate world expects collaboration features in productivity suites, and Microsoft is delivering them. That's a good thing for the company's future.

6. Can it be Microsoft's future cash cow?

Office and Windows continue to be the cash cows for Microsoft. However, many of its other businesses are not performing all that well. Considering the future of productivity will be in the cloud and Office 365 relies heavily upon the Web, the service itself could eventually be a major cash cow for Microsoft. Then again, it might not. Right now, Microsoft needs to focus on making Office 365 a revenue winner as enterprise users transition to other platforms to fulfill their corporate needs.

7. It will decide Microsoft's future strategy

Though Microsoft is aware that the future of the marketplace is in the cloud, the company is taking a bit of a risk investing so heavily in a new cloud productivity suite for enterprise users. If Office 365 turns out to be a flop, executives might be gun shy about investing even more into the cloud. However, if the platform succeeds, it could be the inspiration for Microsoft's entire productivity strategy. Simply put, Office 365 could determine what Microsoft's future go-to-market strategy will be.

8. Call it price testing

As noted above, Google Apps for Business costs users $50 per user per year, making it substantially cheaper than Office 365, which starts at $6 per user per month and goes up to $27 per user per month. By pricing this suite so high, compared with the competition, Microsoft is setting itself up as a premium provider of what it calls a premium product. Exactly how the enterprise will respond, however, remains to be seen. Office 365 could play a role in Microsoft pricing in the coming years.

9. It sets the framework for future consumer initiatives

Although Office 365 is decidedly enterprise-focused, it could be the framework for robust cloud-based productivity solutions Microsoft might have planned for consumers. Granted, the company already has Office Web Apps for consumers, but it's not widely used. And there is good reason to believe Microsoft could be planning more consumer initiatives in the coming years. The success of Office 365 and how employees respond to its functionality might impact future Microsoft decision-making in the consumer space.

10. It opens another front against Google

As noted, Office 365 is Microsoft's best answer yet to Google Apps for Business. More importantly, the productivity suite opens up another front against the search giant. Across several markets, including mobile, search and even operating systems, Microsoft and Google are battling it out. With Office 365 now available, the companies are vying for the enterprise. And as Microsoft's history has shown, the enterprise is one market that both companies definitely want to control.

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Don Reisinger is a freelance technology columnist. He started writing about technology for Ziff-Davis' Since then, he has written extremely popular columns for, Computerworld, InformationWeek, and others. He has appeared numerous times on national television to share his expertise with viewers. You can follow his every move at

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