Microsoft Hosted Services Expected

SAN FRANCISCO -- Top Microsoft executives speaking here next week are expected to reveal the first in what many observers believe will be a range of hosted services from the software company, analysts said Friday.

Microsoft Chief Software Architect Bill Gates and Chief Technical Officer Ray Ozzie will hold a press and analyst event in San Francisco on Tuesday where they will, among other things, "preview upcoming technologies from Microsoft," according to an e-mail alert about the event from Microsoft's public relations firm, Waggener Edstrom.

Analysts say the two high-profile industry executives are likely to unveil hosted services from Microsoft that steer users toward using other components of Microsoft's software platform. Microsoft executives have announced the company's intent to offer hosted services but have not unveiled many details of that plan so far.

Revisiting Efforts

"I think they're going to announce business-focused services that are complements to Microsoft's software," said Rob Helm, director of research at Directions on Microsoft. "I think at the [July] financial analyst meeting, [executives] said clearly they saw it as a viable business. ... Outside vendors are proving it's a viable business."

Microsoft will probably follow the lead of companies such as Intuit and Salesforce.com and offer both a hosted document data-sharing service and a hosted customer relationship management (CRM) service, Helm said. Intuit offers data-sharing with its QuickBase service, and Salesforce.com provides CRM with its namesake service, Salesforce.com.

Hosted CRM would not be new territory for Microsoft, since the company's MSN division offered a hosted CRM service called ClearLead as part of its BCentral for Hosted Small Business Services in 2000, but it didn't catch on with customers.

"It was too early, and MSN didn't have a strong brand recognition in the small-business area," Helm said. "Since then, Salesforce.com has shown that [hosted CRM] is a viable business, and this time around Microsoft has a better understanding of how to get to customers."

Into the Groove

In addition, analysts expect the two executives to discuss new services from Groove Networks, Ozzie's company that Microsoft purchased in March, such as a secure file-sharing service companies can use to collaborate with trusted partners.

Some prominent Microsoft watchers, such as Richard MacManus, also have suggested a hosted version of Microsoft Office may be in the works. In his Web log, Web 2.0 Explorer, freelance Web analyst and writer MacManus on September 28 outlined Web-based productivity suites from smaller vendors and predicted that Microsoft would eventually come out with its own.

"The time for the Web-based office will come, mark my words," MacManus wrote. "When broadband is ubiquitous, web functionality is richer, issues of security and reliability have been put to rest, and most importantly of all--when corporates are ready to make the jump. It may be five to ten years down the track, it may be longer."

MacManus, who writes from Wellington, New Zealand, did not respond to a request for an interview Friday.