Software-plus-services equals?

Microsoft has really gone for the cloud (http://www.microsoft.com/azure/windowsazure.mspx), but are its ideas for online services really down to earth?

There have been various online services from Microsoft for a while now, including a range of offerings under the "Live" umbrella. In this post, I want to look at the importance of Microsoft's distinction between Software plus Services and Software as a Service as a description for services such as Microsoft Exchange Online and Microsoft SharePoint Online.

Firstly, Exchange and SharePoint online services are supplied as part of the Microsoft Online Services brand (http://www.microsoft.com/online/default.mspx), and there are several ways to obtain these services; the Business Productivity Online Suite (BPOS), for example, includes Microsoft Exchange Online, Microsoft SharePoint Online, and Microsoft Office Live Meeting. Secondly, Microsoft Online Services uses a subscription model, and you pay monthly for per-user access to any of the online services; the Microsoft Online Services licensing model lets you assign licenses to just those users who really need online access to secure Exchange, SharePoint, and other services.

So, are Microsoft Online Services an example of Software as a Service (SaaS)? Well no, at least not in the sense that SaaS is usually used, which is to define software delivered over the Internet and which eliminates the need for local application installation and maintenance. However, Microsoft Online Services does share a cost model with SaaS, in that you are in effect paying monthly rental on your services. The reason Microsoft describes Microsoft Online Services such as Microsoft Exchange Online and Microsoft SharePoint Online as Software-plus-Services, is that this is a hybrid model – some real local software and some "out there" services.

Moreover, Microsoft Online Services is a hybrid in more ways than one. Perhaps most importantly, you get the hybrid benefits of always-available hosted services out there in the "cloud" combined with the functionality of local client software – the full Microsoft Office experience on your desktop for interacting with local or online Exchange and SharePoint servers. Compare this to the Google applications model, where everything is through the browser – or at least until Google Gears-powered offline access is extended to all types of documents. But Microsoft Online Services is also a hybrid in another way; you can choose just how much of your local services you actually migrate to the online environment. For example, although you might be using Exchange online, this doesn't stop you using local Exchange servers as well and you can choose which of your user's mailboxes get to be accessible through Exchange online. Your hybrid environment also gets to share resources, so that your Exchange Global Address List (GAL), for example, is available to online and local clients.

The hybrid Software-plus-Services model certainly has the potential to deliver the best of both rich local client software and online services, and although this model doesn't completely eliminate local software support requirements (unlike SaaS), it does offer the potential to significantly reduce infrastructure overheads.

And it is the infrastructure issues that are really at the heart of the Software-plus-Services model; if I've still local software to support, the big question is why bother? Surely it is easy enough to set up Outlook Web Access (OWA) for your own Exchange servers, or to publish a SharePoint site which is accessible outside your perimeter network? Well easy if you've got the resources and the experience, but for many smaller organizations dealing with the security implications can make it difficult to justify. If the pricing suits your organization, using a hosted service could make a lot of sense.