Microsoft Pushes Hosted Messaging and More for SMBs

In a move designed to help small and mid-sized businesses take advantage of the latest in communications and collaboration products, the software giant today announced Microsoft Solution for Hosted Messaging and Collaboration 3.0.

Rather than investing in the hardware to run messaging and collaboration software and the staff to manage it, the hosted service, which will be available through Microsoft’s service provider and hosting partners, allows a small business to pay a monthly fee to use the applications as Web-based services.

While hosted Exchange is not a new concept, the program now offers support for hosted versions of Microsoft Office Live Communications Server 2005 and Windows SharePoint Services, providing SMBs with access to enterprise-class e-mail, shared calendar, contacts, document collaboration and instant messaging capabilities.

“SMBs can feel, look and act like a big enterprise even though they may not have the capabilities to run a server in-house,” Morgan Cole product manager, hosted messaging and collaboration solutions at Microsoft, said.

Cole acknowledged that some SMBs may balk at the notion having their e-mail and other data store off-site. However, he said, many small businesses realize the inherent benefits in outsourcing messaging and collaboration software. “Businesses may at first feel it’s more secure to have their data in-house, but they realize that they are actually less secure because of spam and viruses. They realize hosting providers are the experts,” Cole said.

Microsoft Solution for Hosted Messaging and Collaboration 3.0 includes the following features:

  • Rich hosted messaging. In addition to e-mail services, the collaborative environment is designed to let you share calendars and contact lists with colleagues as well interact with the Microsoft Office Outlook 2003 client.
  • Real-time e-mail, calendar and contacts management. Using Outlook Web Access, Microsoft says you can use any Internet-connected device to check e-mail by simply typing the URL and supplying a name and password.
  • Collaboration tools. Windows SharePoint Services provides an integrated information dashboard for sharing notes, collaborating on projects and optimizing resources.
  • Instant messaging. Microsoft Solution for Hosted Messaging and Collaboration supports instant messaging through Live Communications Server 2005.

The concept of software-as-a-service is making sense for more SMBs, according to Melanie Posey, research director of Telecom Markets at IDC, a Framingham, Mass.-based research firm. Posey said many businesses either can’t afford or simply don’t want to spend the money for an in-house implementation. “Small businesses can benefit from these services. Many of them use free AOL and Yahoo accounts and need to look more professional,” Posey said.

Small businesses should have little trouble finding a service provider to sign up with as Cole estimates that about 500 service providers already derive revenue by providing Exchange as a service. With today’s announcement, however, Microsoft hopes that number will grow even larger.

One example of such a service provider is USA.NET, a Microsoft Gold Certified Partner for Advanced Infrastructure and a veteran supplier of Microsoft Solution for Hosted Messaging and Collaboration. “With the new solution, we are now able to offer our customers an even richer service. We’re particularly excited about offering the document collaboration capabilities found in SharePoint Services hosting,” said David Ramon, CEO of USA.NET in a statement.

Cole said that businesses with between 10 and 75 employees are prime candidates for hosted messaging and collaboration, though “it can go as low as two employees.” Per-user, per-month prices start around $6.95, Cole said. However, that would be for Microsoft Exchange only. Monthly fees would increase (probably to the $20 peruser, per-month range)if you add Sharepoint and Live Communications Server 2005 services.

Service providers can keep their fees low for SMBs, according to Microsoft, because the new scalable, multi-service platform allows them to get the most from their existing servers. By consolidating their existing e-mail systems onto a single platform, they reduce their cost of deployment, operation and support. Of course, that shared-tenant approach does mean that your e-mail is stored on the same server as that of other businesses. However, Cole assures SMBs that Microsoft “has resolved security concerns.”

The hosted approach makes sense, according to Posey, for both Microsoft and small businesses. SMBs can work with service providers that they trust and who are experienced working with smaller businesses. For Microsoft, it’s a more efficient way to reach an attractive, if elusive, market segment. “Reaching small businesses — however good as it sounds — is like herding cats.”

The new services are expected to be available from Microsoft service provider partners starting January 19.

Dan Muse is executive editor of’s Small Business Channel and EarthWeb’s Networking & Communications Channel.

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