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 Microsoft recently announced it was going to make substantial price cuts to the recently introduced SaaS versions of its on premise productivity software. Microsoft BPOS, a combined package of SharePoint Online, Exchange Online and LiveMeeting, which was introduced at a price of $15 per user per month, now stands at $10 per month. The price of Exchange Online standalone has been reduced from $10 to $5, and that of SharePoint Online reduced from $7.25 to $5.25. The prices of other offerings under Microsoft Online Services remain more or less the same.
Some view this as a move by Microsoft to preempt the growing clout of Google Apps in the enterprise domain. But as expected, Microsoft officials denied that the price cut is in response to competition from Google Apps. They attributed the cuts to “rapid customer adoption, global scale and improved efficiencies from new software such as Exchange Server 2010″. Microsoft officials have also raised doubts about Google's claim of having 2 million enteprise customers for Google Apps, questioning how many of these were paying customers. The most important question. On the face of it, this price cut by Microsoft makes its hosted productivity offerings a lot more viable for small and mid sized businesses. Think again. BPOS is a refurbished version of SharePoint and Exchange, Microsoft's traditional on premise software solutions. Both Exchange and SharePoint have been mainly crafted for the enterprise segment, and the hosted SaaS versions retain some of that legacy. Because of this reason, they retain some of the complexity and their feature set is somewhat of an overkill for the small to medium sized business segment. In all probability the implementing company will have to hire consultants to help with the implementation process. These are extra costs that have to be factored into the decision. The varguy reported one company had made $167 per seat providing implementation, training and other services for BPOS.Is it a wonder then that Microsoft is pushing BPOS through its partner network? HyperOffice did a good comparison of Microsoft BPOS and Google Apps, which gives you a good "total cost" comparison. They have also positioned themselves as a third alternative for smaller businesses.
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