Microsoft announced this week that it is replacing current cloud productivity offerings with a consolidated cloud productivity suite under the banner Office 365. Office 365 is in limited beta, and not expected to be officially available until sometime in 2011, but when it launches it will present a compelling case for small and medium businesses to move to the cloud.
1. Overhead. Deploying the same services and software internally can be an expensive endeavor. SharePoint, Exchange, and Lync would all require server hardware. The server(s) would consume power, and require cooling. Using Office 365 frees organizations from investing in the hardware and infrastructure required to provide the same tools in-house.
2. Maintenance. With that server hardware and infrastructure comes the IT expertise and manpower to maintain it. With Office 365, Microsoft is responsible for keeping the servers patched and updates, troubleshooting problems, upgrading hardware and software, and other general server and IT maintenance. This is particularly valuable for smaller businesses that don’t have a dedicated IT department, or even a dedicated IT admin.
3. Availability. One of the biggest handicaps of PC-based productivity software is…well, that it’s PC-based. Business computing is increasingly mobile. People are on the go and conduct a variety of common business tasks using smartphones and tablets while away from the PC. Office 365 is a cloud-based platform that users will be able to access from anywhere they can get a connection to the Web.
4. Cost. Microsoft Office 2010 Professional costs almost $400 on Amazon. Businesses can commit to support contracts or purchase in larger volumes that will result in lower per-seat costs, but small businesses often buy software off the shelf from Best Buy or Amazon. Suffice it to say, outfitting a company with Office 2010–never mind SharePoint, Exchange, and Lync–is an expensive proposition.
The math for calculating the break-even will vary from company to company, but at $6 per month Office 365 is only $72 per user per year. Using simple math, it would take more than five and a half years to surpass the cost of purchasing the standalone Office 2010 Professional software, and that doesn’t include the cost of all the backend server platforms.
5. Productivity. Obviously, Google offers most, if not all, of the same advantages in terms of overhead, maintenance, availability, and cost. Where Google can’t really compete with Microsoft is in providing a familiar platform consistent with what a majority of businesses are already familiar with.
For organizations that rely exclusively on Google Apps, that may not be an issue, but when working with partners, customers, suppliers, and other outside entities, the value of Google Apps is directly tied to how well it can emulate Microsoft Office. Why not just use Microsoft Office?
Office 365 is a bold move by Microsoft to move office productivity to the cloud. The various platforms and applications that make up Office 365 will provide businesses with the tools they need, at a price they can afford.