Fee-based services considered for MSN

Microsoft, apparently serious about turning software into a service, is testing the US waters with a number of new, fee-based MSN services, including virus protection, music subscriptions and even an e-mail-via-phone plan, sources say.

But the company is still wrestling with exactly what its software services strategy will entail, both from a product and a business perspective.

The plans to enhance MSN offerings come as Microsoft is working overtime to add .Net "software as a service" hooks to its various operating system and applications software. .Net is Microsoft's initiative for turning software into a service business, helping the company expand revenue sources beyond its traditional application sales.

As the Washington-based company has done in the past when it starts planning for an operating system upgrade, Microsoft has been surveying consumers about the kind of MSN services they would like and how much they would be willing to pay.

One consumer said he was surveyed by the Harris research organisation, recently, on possible new MSN services, including premium e-mail, virus protection, technical support and music subscriptions.

"They wanted to know what the services were worth to you, what your upper limit would be and what your lower limit would be, and how likely you were to use the services at those prices," said the consumer, who spoke on condition of anonymity.

The Windows enthusiast Web site, ActiveWin, on Monday published a list of possible new MSN services, provided from anonymous sources.

According to ActiveWin, these potential services include the following:

• Email Plus, an e-mail consolidation, filtering and encryption service.

Microsoft is contemplating making a number of these services free for those who subscribe to the company's MSN Internet service, said a source, who asked not to be identified.

For those who do not use MSN as their Internet provider, Microsoft is considering making these services available for a monthly subscription service charge, the source said.

Microsoft executives declined to comment on the authenticity of the list of possible MSN services published by ActiveWin.

"It's no surprise that Microsoft is constantly evaluating different services and ways of delivering them," said MSN lead product manager, Bob Visse. "We're always in beta (with MSN), and always have new things we're working on."

Visse confirmed that Microsoft continuously surveys consumers on the types of products and services they would be interested in purchasing.

"We're doing what consumers want and expect," Visse added. "We are looking at things people do on a daily basis and are advancing them with technology."

Microsoft is expected to ship a new version of its MSN Explorer some time this year. Sources have said that Microsoft is working to deliver a new version of its MSN Messenger instant messaging client, as early as this spring. On Tuesday, MSN competitor, America Online, announced plans to better cross-promote its Netscape subsidiary's technologies in the form of a new, Netscape-branded toolbar.

Microsoft also continues to update the various consumer services, such as financial, shopping, e-mail and the like, that are available today via the MSN.com web site.

Last month, Microsoft president and chief operations officer, Rick Belluzzo, told financial analysts that Microsoft is forging ahead with MSN services and will figure out the best business model in the process.

"We're not going to sit and analyse forever what the consumer is willing to pay," Belluzzo said. "We're going to put together some rich set of services, mostly built around communications, and we have a lot of innovative work going on in that area, and we're going to work to sell a package of that as a subscription. That package of capabilities can be available from a knowledge worker perspective, a consumer perspective, a small business perspective, and we're just going to start testing that down that path.

"When we're all done, we believe there will be some ad-funded activities, there will be some subscription based, and we'll build a series of business models that will add up around that," Belluzzo added.

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