Microsoft News Tracker

Microsoft today announced the release of Service Pack 1 for Response Point, their embedded software for small business phone systems:

Today at the Microsoft Worldwide Partner Conference 2008, Microsoft Corp. announced that Response Point Service Pack 1 (SP1) is now generally available. SP1 is a significant feature update to Microsoft Response Point, easy-to-use and -manage phone system software designed for small businesses with one to 50 employees. Current Response Point customers and partners in the U.S. and Canada can download SP1 for free at http://www.microsoft.com/responsepoint.
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Response Point SP1 builds on the overall ease of version 1 and enables small businesses to immediately take advantage of powerful new features, including session initiation protocol (SIP) trunking for VoIP calling; click-to-call functionality for any contact using the Assistant software; a call history log; and the ability to select music for parked calls and hold time. SP1 is a simple, free download that takes a matter of minutes for a customer or partner to install.

Microsoft also welcomed Aastra as the third Response Point OEM. Uniden, which was one of the original 3 OEMs along with D-Link and Quanta when Response Point was announced, has apparently dropped out.

Microsoft today unveiled two new Microsoft Online Services offerings, Exchange Online Deskless Worker and SharePoint Online Deskless Worker as well as a Deskless Worker Suite that combines the two. The target market is enterprises with workers who don’t spend their day in front of a computer or perhaps not even at a desk, but still occasionally need typical information worker computer services:

A Deskless Worker Suite, including Exchange Online Deskless Worker and SharePoint Online Deskless Worker, will be available for $3 (U.S.) per user, per month. Customers can also subscribe to each service independently. Exchange Online Deskless Worker will provide e-mail, calendars, global address lists, anti-virus and anti-spam filters, as well as Outlook Web Access Light for access to company e-mail. SharePoint Online Deskless Worker will provide easy access to SharePoint portal and team sites and search functionality, giving employees read-only access to important information such as company policies, training and benefits.

Microsoft is also targeting traditional information workers via an offering apparently named the Microsoft Business Productivity Online Suite:

For information workers, businesses can provide an online business productivity suite of Microsoft’s enterprise-class communication and collaboration software as a subscription service. The suite includes the following:

• Exchange Online for desktop and mobile e-mail and calendars with Outlook Web Access and full Office Outlook integration
• Office SharePoint Online for portals, collaboration, search and customized team sites
• Office Communications Online for instant messaging and presence
• Office Live Meeting for Web conferencing and videoconferencing

The suite will be available for $15 per user, per month (U.S.). Customers can also subscribe to each service independently.

As I have observed before, this (except for Live Meeting) is merely managed hosting of Microsoft server software and Microsoft’s venture into this market has always had the problem of undercutting partners who were offering equivalent hosting services before Microsoft Online Services was even a gleam in Microsoft’s eye (e.g. hosted Exchange). An obvious salve for the wound is to cut partners in on the deals and in that regard Microsoft also revealed some partner commission terms:

Microsoft Online Services creates a new opportunity for Microsoft partners to win new customers, increase revenue and boost sales velocity. Partners are seeing new opportunity to migrate, combine and customize Microsoft Online Services. In addition, partners that sell Microsoft Online Services will receive a recurring revenue stream for as long as their customer subscribes to the services.
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Partners that sell the Microsoft Business Productivity Online Suite, Deskless Worker Suite or any of their components receive 12 percent of the first-year contract price and 6 percent of the subscription fee ongoing. This can translate into 18 percent of the subscription value in the first year of the partner’s relationship with the customer.

While not wildly lucrative, it is certainly better than nothing, and it allows the partners to focus on their particular value-adds while leaving the high-capital outlay/low profit margin managed hosting business to Microsoft. Who says Microsoft isn’t their partners’ pal? Presumably Microsoft’s fear of Web app providers and their perceived ability to defeat Microsoft managed hosting partners in the marketplace is what is driving Microsoft to make what seems like an unneeded and not particularly rewarding investment in Microsoft Online Services.

One final note - as far as I can tell, all of the Microsoft Online Services discussed above except for Office Live Meeting are still in beta although you have to read the fine print to discover that.

Update: Elsa Wenzel at CNET has a nice chart of the various offerings and their prices, and observes:

Exchange Online and Office SharePoint Online remain in beta, with final availability set for sometime in the second half of 2008, when Office Communications Online beta is also due. Microsoft plans for international availability in 2009.

Today at Microsoft’s Worldwide Partner Conference (WPC), Steven VanRoekel, senior director of Microsoft’s Windows Server Solutions group announced the launch date for Windows Small Business Server 2008 and Windows Essential Business Server 2008:

I am excited to announce that Nov. 12, 2008, is the official launch date for Windows Small Business Server 2008 and Windows Essential Business Server 2008. Activities that day will signal availability of both solutions and kick off launch efforts worldwide. In many ways, though, we consider WPC our launch for partners and we want to help them plan and prepare for the solutions.

We are also announcing that both solutions are reaching the Release Candidate 1 milestone, another step toward final release. Pre-release versions of Small Business Server 2008 and Essential Business Server 2008 are available for download and evaluation now through www.multiplyyourpower.com.

SBS and EBS are Microsoft’s bundles of Windows Server 2008 and selected middleware directed at small and medium businesses respectively. Pricing for both had been announced in May.

The major problem with Carl Icahn’s proxy fight to take over Yahoo has always been that he offered no remedy for the company’s ills and the shareholders’ discontent other than selling part or all of it to Microsoft and it was not clear that Microsoft would play. That doubt was dispelled today when Icahn issued an open letter to Yahoo shareholders saying that Microsoft was still willing to talk, but had concluded that it was impossible to reach an agreement with the current board and Microsoft confirmed it:

Despite working since January 31 of this year, as well as in the early part of last year, we have never been able to reach an agreement in a timely way on acceptable terms with the current management and Board of Directors at Yahoo!. We have concluded that we cannot reach an agreement with them. We confirm, however, that after the shareholder election Microsoft would be interested in discussing with a new board a major transaction with Yahoo!, such as either a transaction to purchase the “Search” function with large financial guarantees or, in the alternative, purchasing the whole company.

As Mr. Icahn notes in his statement today, it would be premature to discuss at this time important details such as the price or other terms of a possible transaction.
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While of course there can be no assurance of a future transaction, we will be prepared to enter into discussions immediately after Yahoo!’s shareholder meeting if a new board is elected.

One has to observe that holding a one bidder auction is hardly the most effective way to realize full value for Yahoo and that is exactly what Icahn’s plan amounts to. The question then becomes whether Yahoo shareholders are so exasperated that even betting on that uncertain return seems like a good deal.

Microsoft today announced that they had reached agreement to purchase full control of MSN Israel from their local partner, Internet Gold, who currently owns 50.1% of the Israeli MSN portal. No terms were revealed.

The parties are currently discussing the terms of migration and possible future cooperation. The msn.co.il portal will continue to operate throughout the transition period and both parties are working together to support employees, advertisers and users through this period.

MSN is a global portal network which operates in 44 countries. In almost all of these countries the MSN portal is fully owned by Microsoft Corp. and only in a very few instances has Microsoft joined forces with a domestic partner to establish a local MSN portal. In 2007, MSN Israel accounted for less than 3% of Internet Gold’s total revenues.

I guess they are trying to tell us this is no big deal for either party, but obviously it must be for Microsoft if only to provide worldwide uniformity of offerings. Two other large MSN/local partner variants are in Australia (the 50% partner is the Nine Network which we mentioned last week) and in China where the original quasi-governmental partner, Shanghai Alliance Investment Ltd., has been trying to unload its 50%, most recently to The9 Ltd., although despite some reports, that deal has apparently never been consummated. It cannot go to Microsoft because of Chinese restrictions.