Microsoft Office 365: The Hosting Partner Opportunity

By Jessica Davis

Microsoft Office 365, announced yesterday as the software giant’s answer to Google Docs and Google Apps and Zoho’s online productivity suites, may have left many in the channel wondering where they would fit into the equation. After all, Microsoft’s channel partner program is huge, and IT solution providers have sometimes expressed concern about the move from the traditional on-premise model to the cloud.

But big hosting provider Intermedia and Microsoft itself say that hosting partners have nothing to worry about. On the contrary, there is loads of opportunity for channel partners in the cloud.

"Finally, Microsoft has delivered an offering that has the potential to become a Google-beater," said Serguei Sofinski, CEO of Intermedia, in a prepared statement. "As a low-cost cloud service for the smallest companies, it’s more compelling than Google Apps and is a big step in the right direction.

"We’re looking forward to how Microsoft will engage its partners in bringing these new choices to a broader audience," he added. "This is what will put Office 365 over the top. At Intermedia, together with our 6,000 partners, we believe that the channel model is Microsoft’s greatest advantage in addressing the large segments of the market that require full support and integration outside the Microsoft product line – such as with BlackBerry or business-grade VOIP. Likewise, many managed service providers want to own the customer relationship directly, not have Microsoft as the intermediary."

Microsoft said the big opportunity for hosting providers will be to offer value-added services to extend the features offered to small businesses in Office 365. Hosted email, a particularly fragmented space, offers a big growth opportunity, according to Microsoft.

Microsoft channel executive Marco Limena recently wrote about just that opportunity in his blog at Microsoft.

"In the small and midsize business (SMB) segment, hosted e-mail is extremely fragmented — with Microsoft Hosted Exchange accounting for only a small percentage of the space — and this is where we see a huge opportunity for both Microsoft and its hosting provider partners to grow. Within the current landscape, we’re continuing to see significant growth rates of partner Hosted Exchange seats, with an 18 percent increase worldwide last year," he wrote.

"Office 365 for small businesses is targeted at customers with up to 50 users. It includes access from virtually anywhere to e-mail, documents, contacts and calendars, and is easy to try out, simple to learn and straightforward to use. It works with Microsoft Office, which most of these small businesses are already using, and is simple to manage without IT expertise due to its basic administration features. Office 365 for small businesses is backed by Microsoft with a 99.9 percent uptime guarantee."

Limena suggested that hosting providers could offer customers IT tools, phone support, the ability to grow beyond 50 users, sync with Active Directory, advanced IT management, enterprise-class e-mail, Web content management, business intelligence, additional storage, security features, archiving and the full Microsoft Office suite.


This article was originally published on 2010-10-20