Microsoft chops prices of its hosted enterprise cloud offerings

Summary:Microsoft is cutting prices of its Microsoft-hosted Exchange, as well as its suite of business services (known as the Business Productivity Online Suite, or BPOS), and is refunding the difference to existing hosting customers.

Microsoft is cutting prices of its Microsoft-hosted Exchange, as well as its suite of business services (known as the Business Productivity Online Suite, or BPOS), and is refunding the difference to existing hosting customers.

Microsoft is cutting its Exchange Online pricing from $10 per user per month to $5 per user per month. It also is cutting the price of the BPOS bundle -- which includes SharePoint Online, Exchange Online, Communications Online and Live Meeting -- from $15 per user per month, to $10 per user per month.

Microsoft is leaving the pricing for its Deskless Worker versions of its hosted Online offerings the same. Exchange Online Deskless Worker and SharePoint Online Deskless Worker remain $2 per user per month. The bundle of the two Deskless Worker offerings stays at $3 per user per month.

Not surprisingly, Microsoft officials didn't attribute the price cut to competition from Google Apps or other hosted offerings. Instead, they attributed the cuts to "rapid customer adoption, global scale and improved efficiencies from new software such as Exchange Server 2010" (according to the press release).

Microsoft is making BPOs available in 15 new countries before the end of the year. Later this week, BPOS will be commercially available in Singapore; trials are slated to begin in Brazil, Chile, Colombia, Czech Republic, Greece, Hong Kong, Hungary, Israel, Malaysia, Mexico, Poland, Puerto Rico, Romania and Taiwan. Commercial availability in India is also expected later this year, officials said.

Microsoft officials are now claiming to have more than 1 million paying users for Microsoft's Online family of services (not counting Live Meeting, for which there are many more paying customers, according to company officials). Newly signed BPOS customers include Hofstra University, Lions Gate Entertainment, McDonald’s Corporation, Rexel Group, Swedish Red Cross and Tyco Flow Control.

Microsoft will be adding a paid, Microsoft-hosted version of Office Web Apps -- the Webified versions of Word, Excel, PowerPoint and OneNote-- to its Online stable next year. Company officials have said that paid offering will also be available to Microsoft volume-license customers so that they can host Office Web Apps themselves, on-premises, instead of or in addition to allowing Microsoft to host it for them. There will be additional (and, as yet, still unannounce) features that will be part of the paid Office Web Apps offering that aren't part of the free, ad-funded version.

Microsoft is currently rolling out refreshes to its Online family of services every 90 days or so, according to Ron Markezich, Corporate Vice President of Microsoft Online. Some of the new features the company is rolling out to its on-premises software -- such as Exchange 2010 -- are debuting in the hosted, Online offerings before they are available to customers as server-based products. (The final Exchange 2010 software bits are slated to go to customers starting next week.)

I'm sure Microsoft customers will be upbeat about the price cuts for Microsoft's hosted offerings. But I'd think Redmond's partners who are trying to make money from selling Microsoft's hosted services (if not their own hosted version of Microsoft's wares) might be less enthusiastic...

Topics: CXO, Cloud, Collaboration, IT Employment, Microsoft, Software

About

Mary Jo Foley has covered the tech industry for 30 years for a variety of publications, including ZDNet, eWeek and Baseline. She is the author of Microsoft 2.0: How Microsoft plans to stay relevant in the post-Gates era (John Wiley & Sons, 2008). She also is the cohost of the "Windows Weekly" podcast on the TWiT network. Got a tip? Se... Full Bio

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