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Hosting company The Planet has partnered with software behemoth Microsoft to widen the reach of Windows Small Business Server through a software-as-a-service arrangement.

On Aug. 28, Houston-based The Planet will launch a partner program built around hosted SBS whose goal is to make it easier for VARs and integrators to sell the product to their small business clients.

End user customers, for their part, gain access to enterprise-class technology they otherwise might not afford, said Urvish Vashi, director of product management at The Planet.

“Small and midsize companies have the same IT challenges as large companies but a lot of times they don’t have the budget,” he said.

The Planet, which provides round-the-clock hosting from six data centers, sits between Microsoft and its VAR and integrator partners to handle the hosting and monitoring of the server on behalf of the partners. The VARs and integrators maintain the relationship with the end users and have the opportunity to add customized applications and services for their clients, said Vashi.

“We’re relying on the resellers to do the final packaging and put their own special sauce on top,” said Vashi. “We’re putting together a solution they can now use to further customize and meet the specific needs of these small businesses.”

The Planet, which bills itself as the largest privately held server hosting company in the world, is a key partner in Microsoft’s hosted SBS strategy, said Michael van Dijken, lead marketing manager of hosted solutions at Microsoft.

“The Planet is essentially our biggest launch partner with hosted SBS,” van Dijken said.

The Planet has about 22,000 customers worldwide, 60 percent of which are channel companies, said Vashi. He added he expects that number to grow as so-called Microsoft Small Business Specialist partners opt for the hosted SBS approach as opposed to on-site implementations for clients.

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The hosted approach has the appeal of recurring revenue for channel partners, who, based on the fees they charge clients, stand to earn hundreds or thousands of dollars monthly from their clients.

Vashi said he expects a good response from Small Business Specialists because demand for hosted solutions is growing among customers. Increasingly customers are opting for the hosted approach, also known as SAAS (software as a service) because it saves them from having to invest on IT infrastructure or staff to maintain that infrastructure.

Hosted solutions, including Exchange and various other applications, remain a small percentage of Microsoft’s overall business, said van Dijken, but he expects the model to gain momentum.

“Hosting is the biggest growth engine for VARs and integrators going forward,” said van Dijken.

Steve Winter, president and CEO of Ergos Technology, a Planet and Microsoft partner in Houston, said there are clear benefits to adopting the hosted SBS model.

“It gives our clients extremely reliable, stable and redundant solutions that they don’t have to put in their site,” he said.

For Ergos, he said, the advantages of the model include almost immediate deployment since the client sites don’t have to wait for the arrival of software or equipment for implementation. The model also frees up Ergos from what he called “tactical” maintenance types of tasks that VARs and integrators typically have to perform for their clients.

“We now are spending our time being more strategic with our clients,” he said.

Another benefit of a hosting partnership for channel companies focused on small businesses is the ability to provide secure hosted solutions round the clock, something that some partners would be hard-pressed to deliver on their own, said The Planet executives.