News

Office 365 Beta: Cloud-Based Business Suite Replaces BPOS

• By John K. Waters
• October 19, 2010

Microsoft today unveiled a new cloud-based version of a suite of productivity tools that combines SharePoint, Exchange, Lync (formerly Communications Server), and both the Office Web applications and the Office Pro Plus desktop client. Dubbed Office 365, the suite goes into beta today (sign up here), and the company plans to release it sometime next year.

Speaking to reporters and partners at an event in San Francisco this morning, Kurt DelBene, president of Microsoft's Office Division, characterized the new offering as "a progressive approach to cloud applications."

"Every single person in the Microsoft Office Division is now thinking about what cloud services mean to our customers, or business and our products," DelBene added. "We are unequivocally at a pivot point in the adoption of cloud services."

Microsoft launched SharePoint, Exchange and Lync as online services in 2009, calling it the Business Productivity Online Suite, or BPOS. That launch, DelBene said, "sent a strong signal, both to our teams internally, and to the market, that we would move our core applications to the cloud and that we would put the cloud at the center of our strategy moving forward." Microsoft customers are currently sending and receiving 167 billion messages every day from its cloud services, he said.

Chris Capossela, senior vice president of Microsoft's Office Division, was also on hand at the event. "You should think of this as everything we know about productivity brought to the cloud as a great service hosted by Microsoft," he said. "By bringing Office, one of the most popular and widely used applications of all time, completely into the cloud era with Office 365, we are throwing down the gauntlet. When it comes to the cloud, we are all in, and we are bringing our very best with us -- the very best applications and the very best partners.”

Capossela said Microsoft has created what it feels is a highly competitive pricing structure because it really wants to capture the small business market. Microsoft plans to offer Office 365 to businesses with less than 25 employees for $6 per user per month; larger companies will pay between $2 and $27 per user a month. Microsoft is including single sign-on access all of these services, Capossela said. Enterprises also have the option to get Microsoft Office Professional Plus desktop software on a pay-as-you-go basis.

Microsoft partner Mamut, a Norway-based provider of CRM, Internet, accounting, and business software for small- and medium-sized businesses, plans to embed Office 365 into its software bundle.

"If you can combine the Office 365 with the line-of-business app and package that together, you really start to take the pain out of IT and how people consume the services as a customer," said Mamut's president, Eilert Giertsen Hanoa, who attended the event. "This is something we would not be able to deliver if we weren't using Office 365."

Eron Kelly, Microsoft's senior director of product management said that within the company, Office 365 is "a huge deal."

"We're taking one of the flagship products of the company -- one of the crown jewels -- and putting it into the cloud. But we're doing it a way that combines the familiar client experience that everyone knows and loves with a rich back-end."

Microsoft is opening a limited Office 365 beta program in seven languages and thirteen countries around the world.