News

Microsoft Claims Strong Sales for Small Business Server 2003

• By Scott Bekker
• March 31, 2004

Eager to show momentum in the market for small business servers, where the low cost of Linux makes it an attractive alternative to Windows, Microsoft this week used the six-month anniversary of the server's launch to circulate word that sales are hot.

Microsoft declined to release raw sales figures. Instead the company asserted that in the four months after launch, Windows Small Business Server 2003 sold 170 percent more units than Windows 2000 Small Business Server did in its first four months. In its first five months on the market, SBS 2003 has sold more units than SBS 2000 did in its entire first year.

"We're quite happy. SBS 2003 has exceeded our expectations in its first months after launch," said Derek Brown, Microsoft's director of product management for Windows Small Business Server 2003.

SBS 2003 is the first generation of the product to be segmented into two versions, a low-cost Standard Edition and a higher-priced Premium Edition. Several vendors including Dell, Gateway and HP launched complete server systems in the $1,000 price range built on the Standard Edition.

Asked what effect the low-cost Standard Edition has had on SBS 2003 sales compared with SBS 2000, Brown answered, "I think it's been huge."

While Microsoft's Standard Edition attempts to compete with Linux on cost, Microsoft also emphasizes a more traditional advantage over Linux in the small business sector, where IT staff is light or non-existent -- ease of use. The company claims the wizard-based setup of SBS 2003 can have e-mail up and running in an organization in less than 20 minutes.

That ease-of-configuration, ease-of-use message got muddled in December when an installation problem emerged related to Windows SharePoint Services, an add-on collaboration service for Windows Server 2003 that is bundled with SBS 2003. Microsoft responded by offering free CALs to SBS customers for a month.

Brown said the free CAL campaign helped and the company saw no dip in demand for the product related to the SharePoint problem.

Meanwhile, Microsoft plans to pack more value into Small Business Server for future and existing customers by offering the upcoming BizTalk Server 2004 Partner Edition for free to SBS 2003 customers. The partner edition, which allows small companies to hook up to the BizTalk trading hubs of larger suppliers, partners or customers, has a list price of $1,000.