Microsoft cuts the prices of its Business Productivity Suite and offers new features for its Dynamics CRM Online at no extra cost, as it seeks to block cloud-based competition from Google, Oracle and other companies. Although Microsoft has traditionally offered many business and consumer applications as on-premises software, it has been making aggressive moves into the cloud in order to match the moves of many of its longtime rivals.
is moving more aggressively into the cloud space by reducing the cost of its
Business Productivity Online Suite and expanding the available features of
Microsoft Dynamics CRM Online at no extra
cost. The moves are designed to counter a number of threats from IT giants
ranging from Google to Oracle to Salesforce.com.
Microsoft cut the cost of the Business Productivity Online Suite-
which includes the Web-based versions of
Exchange and SharePoint as well as Office Communications Online and Office Live
for business customers by about a
third, dropping the per-user price from $15 to $10 per month.
While Exchange has traditionally been an on-premises application for
businesses of all sizes, Microsoft may be hoping that the lowered cost for the
online version will attract businesses to the Business Productivity Online
Suite, which would allow it to stave off a challenge from Google Apps and
In what could be construed as a major victory for proponents of cloud-based
IT systems, Google
won a contract in October from the City of Los Angeles to provide about 30,000
municipal employees with e-mail.
The Los Angeles City Council voted 12-0 on
Oct. 27 to use Gmail instead of Microsoft's Office Outlook, with Google
promising to compensate the city in the event of a data breach.
Gmail and Google Apps are already in use by about 38,000 employees in
government agencies in Washington,
a fact that has encouraged Google to develop a dedicated Government Cloud for
deployment in 2010.
Microsoft has denied publicly that it feels pressure from Google in the
"[Google has] definitely been out there claiming some pretty big
numbers, but a number of their claims aren't holding up," Stephen Elop,
Microsoft's business division president, reportedly
said at a press conference in London.
To encourage businesses to embrace the cloud on its terms, Microsoft is
claiming that its Online Services will be updated with new capabilities every
90 days. Those updates include an increase in mailbox storage space to 25GB for
users of the standard service. Microsoft executives suggested to eWEEK that
25GB was a number frequently cited by customers as ideal for storage space.
Microsoft also expanded the reach of Business Productivity Online Suite,
introducing commercial availability in 36 countries and regions including Singapore.
Previously, Microsoft announced that the next version of its Office
productivity suite, Office 2010, would
include stripped-down versions of Word, PowerPoint, Excel and OneNote
accessible through the browser.
In related news, Microsoft announced new updates on Nov. 3 for Microsoft
Dynamics CRM Online. New features, which are
free to users, include increased data support and customizable views. In an
attempt to pull customers away from Salesforce.com and Oracle CRM
On Demand, Microsoft is also offering Dynamics CRM
Online free for six months.
Other elements present in Dynamics CRM
Online include simple contact management, which provides a unified view of
customer information; a new homepage dashboard with real-time views of key
metrics; and a new price of $44 per user per month.
"This is the way we think about this: The pricing for on-premises
products has come down and become more affordable, and we think that on-demand CRM
can go through a similar shift in the equation," Brad Wilson, general
manager of Microsoft Dynamics CRM, said in
an interview with eWEEK. "We can drive that in the marketplace and give
them a CRM at a low price and put a
compelling offer out there.
"If you're paying more for on-demand CRM,
you're paying for marketing hype," Wilson
added, in what could be construed as a jab against Salesforce and other CRM