SaaS: Microsoft BPOS Evolves Into Office 365

When it comes time to compare cloud suites Google Apps and Microsoft Business Productivity Online Suite (BPOS), The VAR Guy isn’t the only one who notices that the former tends to focus on the SMB space while the latter’s efforts center on the large enterprise. But that all changes with the launch of Microsoft Office 365, which provides SMBs and large enterprises alike access to cloud productivity, messaging, and collaboration. Here’s the scoop.

While the press release announcing the unveiling of the new offering only mentions BPOS in passing, a post on the Microsoft Online Services blog confirms that enterprises using Microsoft’s current cloud product have up a year to make the transition from old to new after Office 365 makes its debut. In the meanwhile, Office 365 will be in beta ahead of its launch “next year.”

But new customers and those who make the switch to Microsoft Office 365 will get access to cloud versions of Microsoft Office, SharePoint Online, Exchange Online, and Lync Online — basically, an entirely Microsoft-powered end-to-end UC, collaboration, messaging, and document creation solution.

“Office 365 is the best of everything we know about productivity, all in a single cloud service,” said Kurt DelBene, president of the Office Division at Microsoft in a prepared statement.

That same press release highlighted Office 365’s value proposition to SMBs, with pricing starting at $6/user/month for businesses with 25 seats or fewer. It’s still more expensive than Google Apps Premier Edition, which prices itself at $50/user/year no matter how many seats are needed, but I suspect a lot of debate over the next several months will be over value for the money in the small business space.

Microsoft isn’t abandoning larger enterprises, though: they have plans to add Microsoft Dynamics CRM Online to the Office 365 suite next year, and at launch Office 365 will have a $24/user/month option for the entire suite plus Office Professional Plus – the first time it’s available on a pay-as-you-go license.

This move makes a lot of sense from the word “go.” Not only does this represent Microsoft’s much-needed refocusing on the small business, it’s also good branding: Microsoft Office is a powerful name in the IT world, with many users associating it with the idea of productivity itself.

The VAR Guy looks forward to seeing how Microsoft Office 365 will shake up the cloud marketplace, so stay tuned. And in the meanwhile, make sure to let us know your thoughts if you sign up for that beta.

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