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Microsoft Puts SharePoint 3.0 in The Cloud

Microsoft is taking yet another step toward its vision of a software-plus-services world. Beginning today, online hosting companies will be able to offer their customers features of Microsoft's most recent on-premise collaboration and communication tools, SharePoint Services 3.0 and Exchange Server 2007.

The Redmond, Wash.-based software vendor said that, by updating its two hosting packages, Hosted Messaging and Collaboration (HMC) and Windows Based Hosting (WBH), it is helping software providers improve their offerings to small and medium sized businesses (SMBs).

According to Michael van Dijken, lead marketing manager for hosted solutions in Microsoft's communications sector group, hosted services are becoming commoditized. "Service providers need to be able to differentiate themselves and deepen their relationships with customers," he told internetnews.com.

Version 4 of HMC includes support for new features included in Exchange 2007, including improved interoperability with devices running Windows Mobile clients, better e-mail filtering, support for more efficient 64-bit architecture and role-based server administration.

Van Dijken said that HMC will be upgraded again in the fall to support Office Communications Server 2007, which is expected to ship this summer.

Version 4.5 of WBH will include a SQL Server hosting tool kit; Microsoft will offer guidance on how to deploy SQL Server in a hosted environment. The upgrade also allows service providers to offer SharePoint services in a hosted manner, which van Dijken said gives them "the ability to take advantage of how the industry has been evolving."

The hosted version of SharePoint Services 3.0, the underlying foundation of SharePoint Server 2007, will enable service providers to offer their customers a variety of "lightweight" versions of Microsoft applications such as project management, vacation time management, sales and marketing and customer relationship management (CRM) tools.

The CRM tool is a scaled-down version of CRM Live, which Microsoft is also marketing to the SMB market as part of its Dynamics line of business applications. To make matters even more confusing, Microsoft is making CRM Live available as a service that can be hosted by a third-party host or by Microsoft itself.

But van Dijken said that the hosted version available to service providers through WBH does not compete with CRM Live because the two offerings are priced very differently.

"Different companies will have different needs, and those needs will translate to price points that they're prepared to pay," he said. He added that some customers "will have heavier requirements for some applications and lighter weight requirements for others," and will be able to pick from among a variety of hosted and on-premise alternatives.

Making those decisions can be challenging, however, because as Greg DeMichillie, lead analyst at Directions on Microsoft, told internetnews.com, Microsoft has a history of overcharging for hosted solutions in order to protect its on-premise business. "They tend to price in a way that doesn't undercut their existing software license business."

Customers should tote up the cost of a license and do things like maintenance, back-up and security internally against the price of a hosted solution, he added.

DeMichillie also noted that customers running enterprise resource planning (ERP) or other business applications on-premise should make sure the service provider they pick has the wherewithal to integrate those tools with a hosted version of SharePoint.

Ultimately, predicted DeMichillie, Microsoft will even begin offering service-based enhancements to their on-premise SharePoint customers. "That will give them two bites at the apple... that's undeniably the direction they want to be going to."