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Microsoft (MSFT) Expanding Online Software Services

Microsoft (MSFT) has found an answer to online software services that people are seeking in order to make their business life easier and so today Microsoft Corp. has announced their expansion business program testing that will be offered as online services. This is an investment strategy that puts Microsoft at the cutting edge and in competition with other reputable companies.

People are now resorting to online capabilities for their writing, accounting, email and other online programs to increase productivity. People are looking for ease of use and so software packages and installation steps have become a distant friend only on occasions.

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“The market for Internet-based software will grow to $14.8 billion by 2011 from $3.7 billion in 2006,” said Erin TenWolde, an analyst at Framingham, Massachusetts-based researcher IDC.

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The announcement of Microsoft services have come at the same time that Google, Inc. (GOOG) and other companies have invested in services that are quite similar and may be competitive to Microsoft products in the coming years. Microsoft Online Services is the new prospective to an early round of up-and-coming battle. Microsoft delivers the Web- based versions from a string of top-secret data centers.

“The combination of software plus services gives customers advanced choice and flexibility in how they access and manage software,” Bill Gates said. “With Microsoft Online Services, businesses can deploy software as a subscription service, from servers they manage on-site, or a combination of the two, depending on their specific needs. In the future, customers and partners should expect to see this kind of choice and flexibility for all of Microsoft’s software and server products.”

Microsoft is using this business services to revamp their efforts to compete on the Internet. Google is reputable for its strong online advertising and this has prompted Microsoft to make an unwelcome business offer to purchase Yahoo, Inc.

However, if Microsoft were to buy Yahoo, it would create hurdles for their business services because Yahoo has already bought Zimbra, Inc in an attempt to build their own business services. Similar to Microsoft services, Yahoo’s services involve both an email and partnership system that is accessible via the Internet.

“Microsoft’s hostile bid for Yahoo raises troubling questions,” said David Drummond, Google’s senior vice president for corporate development and chief legal officer.

According to Google, this may prove to be an unfair advantage for Microsoft since consumers will have limited ability to access other competitor’s email and instant messaging services.

Microsoft management personnel claim that these services are versions of Microsoft software that already exists such as Microsoft Exchange, which is used to operate email and other business communicative functions as well as SharePoint, which is a software for employees who work in groups and have to share information and projects. Customers will be able to access the software over the Internet. Micorsoft is offering a free 14-day trial of this service.

Senior Vice President, Chris Capossela, said that starting today, Microsoft has extended an invitation to a few thousand businesses to test the services, but later a subscription fee will be charged for the service.

He did not want to reveal the price. A big factor in all this is the price factor. I can see the appeal it will have on companies who want to get rid of the need of onsite IT staff with this new service in place.

Bill Gates, Chairman of Microsoft is supposed to host an event in Seattle, where it is anticipated that he will announce services online that manage email, calendars, contact lists, video conferencing and other unique features to small and mid-sized businesses. In September, Microsoft began testing the services with companies that had in excess of 5,000 employees, but has now decided to target smaller companies like Google is doing.

Microsoft Online Services also has open opportunities for resell partners to for consulting services that offer customization and migration of managed services for its customers. Reputable partners include the likes of Evolve Partners, Inc., HCL Technologies Ltd. and Unisys Corp.

This is a new avenue for Microsoft, but not for companies like Google, and that are promoting this very forcefully. Even with that said, these companies are still yet to put a dent into Microsoft’s business. The online services that Microsoft is embarking on are an attempt to keep the competition at a distance.

This may be a wealth building strategy for Microsoft because there will be a lot more business interested in this type of service. Of course, we all know that this will certainly add to Microsoft’s personal stock portfolio.

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