News

AT&T Begins Selling Office 365 to SMBs

• By Kurt Mackie
• November 15, 2012

Telecommunications giant AT&T is now offering Microsoft's Office 365 cloud productivity suite to small and midsize businesses (SMBs).

The Dallas-based telecommunications company began offering Office 365 in three subscription-based plans on Monday. The plans cost between $8 to $20 per user per month, based on having a year-long contract in place.

All of the plans include Exchange Online, Lync Online, SharePoint Online and the use of Office Web Apps, but the cheapest plan allows "view only" privileges for Office Web Apps, meaning users don't have online editing and collaboration privileges. The most expensive plan includes use of subscription-based Office Professional 2010, along with getting bigger Exchange mailbox limits (up to 100 GB per user).

Office Professional 2010 is not accessed online but is installed on the customer's premises, and the businesses using it may be responsible for maintaining it. Since Office Professional 2010 is subscription-based, organizations lose the rights to use it if they stop paying their monthly bills. That circumstance with regard to use rights is also true of the other services in the Office 365 suite.

AT&T's announcement indicates that its Office 365 services include Lync PC-to-PC calling, instant messaging, Web conferencing, high-definition videoconferencing and presence capabilities. However, companies likely would need SIP trunking services from AT&T or some other provider to connect Lync voice-over-IP (VoIP) calls with users on the public switched telephone network. That point isn't explained in AT&T's literature and would presumably cost extra. AT&T's Office 365 description omits describing VoIP as part of the Lync Online offering, so it's a bit unclear.

AT&T, which has a Microsoft gold competency in Communications, is acting as a "syndication partner" in reselling Office 365. The telco doesn't run its own servers to deliver the Office 365 applications to customers. Instead, it resells services from Microsoft's servers while offering technical and setup support as part of its AT&T TechSupport 360 service. Microsoft syndication partners also can bill their customer directly, which has been an evolving issue for Microsoft's partners.

The customer reach represented by telecommunications companies in reselling Office 365 services has the potential to help Microsoft carry out its cloud vision, a big corporate commitment that was enunciated by Microsoft CEO Steve Ballmer more than two years ago. For instance, just in terms of its wireless customers, AT&T reported in its third-quarter earnings statement that it had nearly 106 million in-service customers. The reselling of Office 365 services also can help ease companies into the idea of buying Microsoft's software on a monthly subscription-based rental basis, rather than the traditional "perpetual license" or "annuity license" purchase options where use rights for the software extends past the final purchase date.

Telco reselling of Office 365 services is on the rise. Microsoft has substantially increased the number of "operators and hosters" offering Office 365 services after just a year's time. There were about 20 such companies last year, but that number has expanded to more than 35 today.

"We can confirm that there are currently over 35 syndication partners around the world with offers in-market," a Microsoft spokesperson stated via e-mail. "These include America Movil, AT&T, Bell Canada, Dell, Intercall, Korea Telecom, KPN, Mamut, NTT, Orange, Otsuka, Portugal Telecom, StarHub, Telefonica, Telekom Malaysia, Telisonera, TELMEX, UOI, UPC, Verizon, Vimpelcom and Vodafone among others." 

The spokesperson explained that under Microsoft's syndication partner model, "the Service Provider owns the relationship with customer and the billing relationship," as well as "tier 1 and tier 2 support."