Microsoft Online Services prices cut

The snappily-titled Microsoft Business Productivity Online Services (BPOS) offering, announced some price cuts the other day…

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I heard from someone internally that the price cuts were driven by increased economy of scale – ie. as more customers signed up for BPOS, the cost per customer of providing the services has fallen, and the saving is being passed on.

There’s an online pricing calculator to get an estimate of what it would cost to adopt, but if we took an example of 250 seats of Exchange Online (ie not the full BPOS suite), it would be around £805 per month, or just under £10,000 per annum.

Now that might sound like a lot for only 250 seats, but if you compare with the license costs to buy a server or two, 250 Client Access Licenses and the Enterprise CAL for email protection, you’d be looking at around £15k for software licenses, plus hardware costs (let’s say another £5-10k) and the staff costs to maintain the Exchange environment. It might start to look pretty attractive to outsource the whole “keeping email running” task, and just pay for it to be online.

Some customers like the online services model since it is an operational expense (OPEX) rather than having capital expenses for servers & storage hardware, which is depreciated over a number of years.

Finally, an example of where Online Services might suit particularly well… one fairly well known company (who shall remain nameless for the moment), were still muddling along on an old Exchange 5.5 environment. On Wednesday, the server shuffled off this mortal coil to join the choir invisible, causing a good deal of consternation in the business, who were now completely without email.

I’ve said for a long time, that Exchange is the only mission critical system in most businesses, which affects everyone immediately. If the CRM or billing or the payroll systems fell over, sure, it would be important – but most people wouldn’t know right away that it had happened. Email goes down, and most businesses will feel pain right away.

Back to example company. As fire rained from the sky, they took the decision at 4:30pm to buy 110 BPOS accounts, which were provisioned in 15 minutes and the business was fully back up with email up and running, later that evening.

Pinpoint a Microsoft Partner

This site has had something of a quiet launch – I first saw it a couple of weeks ago and was really impressed – it’s called Pinpoint and is a new take on the question, “How do I find a good Microsoft partner?”

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Simply enter a search (a name of a known partner, or any element of the technology or solution you’re interested in), and a location, and you’ll see results shown on a map, with a list of matches below.

What’s interesting is the ability to review partners or solutions – so if and when this site gets a bit more use, we should see not just a linear list of partners who have the skills, but the ability to  see who gets the best reviews (a bit like on Tripadvisor or Amazon). If you’ve had a good (or bad!) experience with any Microsoft partner, please add a review – it might help someone else to choose the right solution partner for them.

If you work for a Microsoft partner, make sure you’re listed on here with some sensible detail – one of the guys in my team, Matt aka virtualboy, was showing this site to a partner only the other day. Top of the list of results came their main competitor… You have to be in it, to win it, as they say… Make sure you have your products & services listed!

Pinpoint is now linked from the Microsoft UK homepage, via the “Experts” page at http://www.microsoft.com/uk/experts/, which also has more detail about the different types of partner and why you may need their services and help.

Apple put the ‘Networks’ in their place

Having just read Andrew Orlowski’s article over on The Register, it chimes exactly with a belief I’ve had since the original iPhone came out and showed a clean pair of heels to pretty much every other single device: someone had to put the mobile operator networks in their place, and only Apple were in the right place & time to do it.

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As I’ve said previously on here, I’ve been a fan of Windows Mobile since day one, and I recall the frustration with the first generation Smartphones, that the mobile operators exerted so much influence not just on what the device would look like, but what software capabilities it had. The whole design of the application locking of Smartphone (which is the single biggest impediment to the easy spread of applications, a la the Apple App Store), was down to operators demanding that degree of control over the devices… or else there’d be no room on the networks for them.

In some ways, Apple’s brazen approach to the iPhone and it choosing the networks, rather than the other way round, has helped turn the industry on its head. I’m sure Google would have found a way to market with Android, but the fact that T-Mobile doesn’t offer the iPhone (in the US, at least) sure made it a lot more receptive to the boys from Mountain View, I’d wager.

It can be a dangerous game looking to the past for analogies that will prove future outcomes …

Look at the mess in the financial markets as proof – the CFO of Goldman Sachs said in the summer of 2007 that they were seeing 25-standard deviation moves, several days in a row… *

… but what Apple has done to break the shackles of the network operator, could be equivalent in effect to what happened at the dawn of the PC compatible industry. Through a combination of reverse engineering the original PC BIOS, and the fact that the software – DOS – was available from the same guys who provided it to IBM, the control that Big Blue exerted on the design, supply and pricing of that market was effectively wrested from them, initially by a rag-tag of would-be competitors (though some did make it, such as Compaq).

Just like the fixed-line phone companies have had to reinvent their business models numerous times – see Bob Cringley’s archive for lots of commentary on this hobby horse – maybe history will relegate mobile network operators to being a connection utility rather than controlling the content and the whole user experience, as they at one point wanted to do.

Still, Apple has a lot still to do, to be the saviour of the industry … it could still end up as a footnote in the history of this part of the race, with someone else coming along to take the finish line.

//E

* … meaning their predictive statistical model that was based on historical events, was telling them that things that will statistically NEVER HAPPEN were occurring regularly. What does that tell you? The model is now WRONG.

According to Tim Hartford from the FT, who I heard give a talk on this, their models said that:

  • 3 std devs would occur once in every 3 years
  • 4 std devs, once every 126 years
  • 5 std devs, once since the last Ice Age
  • 6 std devs, once since man started walking upright
  • 7 std devs, once in 3 billion years

… so 25 Std Devs would be something that has never and, statistically, will never, occur.

Business continuity – it’s a people thing, not just a premises one

27[1] I had a really interesting discussion with a customer last week, when we were musing over the effects that the snow had on UK businesses. It was another example – like the floods which have hit parts of the country over the last few years – of a threat to business continuity which it’s easy to overlook.

Most businesses have prepared some contingency for what IT should do when it all goes wrong – starting with individual equipment failure (using RAID disks, redundant power supplies & the like), to clustering of services and replication of data to be able to survive bigger losses, either temporarily (like a power cut) or for longer-term outages (like loss of connectivity to a datacentre, maybe even loss of the datacentre itself).

What the weather conditions taught us the other day was that the people are even more important than the premises – the customer said it was ironic, that all their systems were up and running well, it was just that nobody was there to consume them.

Warwick Ashford from Computer Weekly writes about how their publisher, Reed Business Information, has built remote access into their business continuity plans. Interestingly, most of the discussion focussed on how to use VPN technology to connect to the office.

Funny, really. With Outlook & Office Communicator not needing to use a VPN to securely connect back to my office, I spent most of the WFH-time connected, productive, but not using a VPN at all.

When the weather outside is frightful…

… the UC technology is soooo delightful.

OK, it’s cheesy as you can get, but very true. The weather forecast on Sunday night was for heavy snow, and sure enough we awoke on Monday to about 4-6 inches of fresh snow – something that many countries would take in their stride, but in southern England, we just don’t have the infrastructure to cope. [since it’s such a rare event].

I had decided on Sunday night that I was probably going to stay at home, so changed all the face/face meetings I had scheduled for Monday, to phone/video calls.

One director at Microsoft sent an e-mail round to his team on Monday morning:

SNOW CHANGE: Team meeting to be changed LIVE MEETING ONLY! DO NOT DRIVE!

I have been clearly informed that South England does not own snowploughs. And as I look out the window at the 5 inches of snow with no snow tires on my car, as a Canadian who has driven in very big snow storms, I know when not to drive – and this is one of those times. It will be too risky. So, we will probably trim the meeting to the MYR presentation and maybe 2 other topic. More to come – but don’t drive! Looking forward to our meeting – ‘see’ you all there :-).

Thanks;

Michael

I also had a half-day partner meeting which had been scheduled for weeks; that was converted to a Live Meeting so everyone could join remotely. In this instance, the actual partners were stuck on motorways, or holed up at the airport, so in the end it was rearranged for another day.

It was amazing to see how, if the infrastructure is in place to allow it, some companies just flick to having (nearly) everyone work remotely and it not drastically affect productivity. OCS Product Manager Sean Olson wrote about the “Snow Day” phenomenon that happens to Redmond every so often.

In fact, in the mid-December incident hit the news over here, with a bus skidding through a barrier and hanging over the I-5 freeway. Here’s an article with a great VR picture of the scene.

As it happens, we released OCS 2007 R2 yesterday. Also, there’s a report which should be published soon, looking into the business impact of deploying UC at Microsoft, using Forrester Research’s methodology for measuring business value.

The outcome? The RoI for Unified Comms is so clear that it paid for its procurement & deployment in 2 months.

How Microsoft can help you save money

There’s been much said & written about the credit crunch, the downturn, the recession – whatever you call it yourself, it means that the future’s looking a good bit less certain than it was, and pretty much everyone is tightening their belts and bracing themselves for whatever is coming.

Microsoft’s Chief Operating Officer, Kevin Turner, wrote an all-staff email a couple of months ago highlighting a number of things that could save customers money, and since then, there has been an avalanche of papers, presentations, initiatives, marketing plans etc etc, focused on that theme.

My problem statement

The problem I see in a lot of this stuff is pretty simple: the good people who put together the collateral start with a conclusion in mind…

  • Sharepoint marketing folks will write a proposal about how Sharepoint can be used to make people more productive, therefore save money through efficiencies.
  • Windows Server guys will talk about how Windows Server 2008 can cut power usage, which has a direct correlation to reducing both the carbon footprint and the utility bills.

… and so on. All well and good, and some of the output has great stories about real people using the technology to make a real difference. A cynical viewer might observe, though, that the message sometimes looks like "Cut your operating costs, by implementing Microsoft™ Office Sharepoint Server 2007® etc". Yeah, very good, but it wasn’t the act of installing Sharepoint that cut your costs, it was what it allowed you to do differently, or better.

It’s coming together, though

What takes longer than the initial flurry of "this product can save you money" information, is weaving together a more holistic view of the kinds of issues that real world customers are experiencing, then figuring out what all the different capabilities & features of products can do, and applying them in order of importance to help solve the problems. Fortunately, there’s some cracking collateral now, at

http://www.microsoft.com/uk/leverage/ 
(and it’s sub-sites, like the Manage Costs one)

I’m going to write some more on the specific topic of reducing cost, in the coming weeks. Stay tuned…

Virtuali(z)sation & datacenter power

It’s been very quiet here on the Electric Wand for the last month or so:

  • I took a new job in December which means things have been pretty hectic at work. I’m now managing a new group, and lots of time spent building up a great team.
  • Just back from Seattle from a week’s Microsoft internal technical conference.
  • To be honest, I haven’t had much to talk about on the blog 🙂

The TechReady conference I went to in Seattle had a few interesting themes, but much of the technical stuff presented is still internal only so can’t be discussed (yet) online. A good chunk is probably "subject to change" anyway …

There are a few themes which were either covered in a number of different sessions, or which really made me think hard about the way IT is going – amongst them Virtualisation (I do hate using the "z", even though it’s technically OK – it just seems so un-British), the march towards multi-core parallelism (instead of clock speed race) and the whole Green IT agenda of power usage.

I’m planning to write a bit more about both these topics in current weeks, along with business case for Office Communications Server, but here’s some food for thought:

A major enterprise datacenter could well be consuming 10s of Megawatt/Hs of power – something that could be equated to many, many flights or other so-called demons of carbon emissions. A back-of-an-envelope calculation of all Microsoft’s own datacenter power usage (including all the online services) would equate to over 100 Jumbo Jet flights from London to Seattle every day. That’s 100 planes, not 100 passengers…

This power usage topic is one which is going to grow in importance – not just because power prices are rising (eg a 100 MW/h power usage for a large internet datacenter could easily cost more than £15m per annum in power costs alone). One project internally in Microsoft is looking at the actual power usage and the equivalent tonnes of CO2 emissions of all of its datacenters – a concept that’s surely to become more mainstream in the future.

Citing datacenters by renewable energy sources (such as Google’s massive datacenter by the Colorado river in Oregon) makes the power usage more palatable, but it doesn’t remove the need to reduce heat (and air conditioning requirements) and overall power usage – even if it means employing people to physically go round pulling the plugs at night-time on the myriad rack servers.

Anyway, as I said, more on this topic in coming weeks – in the meantime, I’ve not gone away … just waiting for the right time to pipe up 🙂

The downside of online shopping

I bought myself an early Christmas present a few weeks ago. One Saturday morning, sitting at the home PC whilst noodling about on the web, I decided it was time to replace the old warhorse and get something a bit more modern.


So I surfed off to my favourite PC web emporium and specced up a nice new Shuttle box with a quad-core low voltage CPU, 2 GB RAM, 1Tb of disk and a half decent video card. A very good deal at less than £750 delivered, I thought. All from a trusted, well-used website that I’ve spent a small fortune with before.


Problem #1 came when the expected ship-date sailed into the past, and as time got nearer Christmas, I feared for getting hold of this new and shiny toy in time to give me an excuse to excuse myself from the washing-up on the big day.


Repeated attempts to contact the web-vendor failed – “you need to call the web-orders guy on this different number”, said the company’s ‘customer services’ people – and the web guy was either letting his phone ring out (and no voicemail) or was engaged. For two whole days.


Eventually (a week later than scheduled), the goods were showing as “shipped” on ‘reputed’ web company’s site.


This after the goods were showing as in stock on the day I ordered, that is, the day they charged my credit card. Oh, and to add insult to injury, they’d dropped the prices of some of the items the day before they shipped my order… which of course, I’d paid at the higher price.


Problem #2 came when the courier was showing the following day as being “with driver” – and yet nothing happened.


And the following day, it was still the same state.


And the next.


And when I left to take the 1.5 hour round-trip drive to their depot to find out what was going on… guess what… it was really out with the driver this time, and would be delivered before 5:30. REALLY? Yes, said the man. DEFINITELY? Of course.


At 5:20 and with no parcel in possession, I set off to the depot again. Arriving at (cough) 5:55, the nice man took the number of the consignment, checked where it was, and a mere 15 minutes later arrived with the parcel in his hand.


“Why was it not delivered today, as you promised?”, I asked.


“Oh, there’s a real backlog on that route and they didn’t get to deliver it today”, says he.


“And what would you do with that parcel now, had it not been delivered?”


Try again tomorrow. A Saturday. When there’s nobody in the office. And won’t be until the New Year, now. That is, at least a week later than it should have been delivered, according to plan.


And the delivery company says we have two days to pick the parcel up from them if they try to deliver it and nobody’s there, after which they return to sender (see Problem #1).


It’s all made MUCH worse by the fact that this particular courier firm (who I did not choose; the vendor did, because it suited them and was presumably cheaper) is a franchise operation so there’s no single “throat to choke” – they just put you through to the handling depot if there’s any problem. If the depot is incompetent and/or swamped there’s nothing you can do.


In the hour or so that I spent (in total) standing in the depot, the phone was ringing continuously and nobody was answering. There were people sitting at their desks doing “work”, and yellow-jacketed delivery guys hanging about, but nobody manning the phones.


So: I spent 2.5hrs on hold to these people; maybe 1 hour hanging  about waiting to be dealt with at the actual depot; 2.5 hours or so in total driving down and back to chase them up because they don’t answer the phone, don’t respond to faxes* and don’t have an email address…


I sometimes wonder: is e-commerce really worth the hassle, compared to going down to the local PC shop who can give you advice, sell you what they have in stock and let you take it away with you..?


Would I willingly use this same company again?


 


Damn. I’ve just ordered a couple of new bits for the new PC I have, from the same people – it’s easy, they’re cheap, and they promise to deliver by Christmas Eve.


Bets, anyone?



* This was a story from another guy in the queue. He worked for a different delivery company, yet he was picking something up from this one.


He said, his company get fined (internally) if they don’t answer the phone after a few rings. He spent 1.5 hours on hold to this company from 4:30pm to 6:00pm the night before. At 6:00pm the message changed from (and I kid you not) “There are MANY people ahead of your in the queue” to “The offices are now closed… try again tomorrow”).


He sent them a fax, but got no reply.


Merry Christmas, by the way.


Bah. Humbug.


🙂

Unified Communications licensing made easy

Well, hopefully.


I get asked a lot about what licenses customer need when they want to deploy Exchange & Office Communications Server, in order to keep themselves legal & compliant. It’s sometimes a bit confusing that there are several versions of the core products, and often add-on licenses such as external connectors and the likes.


Taking Exchange & OCS separately, the basics are pretty straightforward, really, and (as ever) the devil is in the detail. That detail is on the “How To Buy” pages for Exchange and OCS, respectively.


Server/CAL basics


Like most Microsoft server products, both Exchange and OCS operate on a “Server/CAL” model, where you buy the actual server software, then acquire the access license to give you the rights to use that software from a client machine. CALs can be assigned to people (“users”), meaning the holder of a CAL can access the software from any machine, or they’re assigned to a machine (“device”), which could allow any number of people to use that machine.


In businesses, the “per user” model is the most common model, since you could license users to be able to connect to the server from their home PC or from an internet cafe, or several devices at a time (including PCs, browsers, phones, Blackberry devices etc). In some circumstances (eg shift workers, or students sharing lab PCs), it makes more sense to license “per device”, and you can mix the two together – so you might have 200 users licensed “per user” but then buy 25 “per device” licenses for the call-centre workers who might actually number 75, but working in shifts and only 25 at a time. Clear?


Along with Sharepoint, Microsoft introduced a new CAL type to Exchange & OCS in the 2007 wave of servers – the Enterprise CAL. The deal here is that some of the most advanced, new, functionality in the server software needs an Enterprise CAL to be in possession by the user or device, and it is an add-on to the Standard CAL which everyone will have anyway. You don’t need to buy Enterprise CALs for everyone – only the users or devices which will make use of that additional functionality.


There’s no actual installation of a CAL, and there’s little real tracking of CAL usage: it’s a legal requirement for the organisation operating the software to ensure that you have enough licenses, and that in itself can sometimes be a challenge. Using software like System Centre Configuration Manager, you can keep check on what users are doing, and with partner services such as Software Asset Management, you can get help with keeping track of what you’ve bought and who’s using what.


Standard vs Enterprise Edition servers & CALs


Where some confusion sometimes lies is that, for years, we’ve had Standard & Enterprise Edition servers, where the more advanced functionality (like clustering) was often part of Enterprise Edition, and cost more. Now that there are Standard & Enterprise CALs, things start to look murky. Some literature even refers to the CALs as “Client Access License Standard/Enteprise Edition” which only heightens that confusion.


There is no dependence on CAL versions vs Server versions: ie you could use clustering in the Enterprise Edition server, but still use just Standard CALs to access it. Or you could deploy a single, Standard Edition server, and have all the users taking advantage of the most advanced functionality that comes as part of the Enterprise CAL. And, of course, you can have a mixture of all of the above, as you see fit.


Exchange 2007


The Standard edition of Exchange 2007 is a good bit more capable than Standard Edition previously – there is now effectively no data storage limit to the server (compared to a 16Gb and later, 75Gb, limit in Exchange 2003), though you can only have 5 databases per server (compared to a single one in earlier versions at Standard Edition, and a 50-database limit in Exchange 2007 Enterprise Edition). Apart from some exceptions in how Messaging Records Management works, the only other real difference is that Standard Edition server doesn’t support clustering.


If you want to run clustered Exchange, you need Exchange Enterprise Edition on top of Windows Enterprise Edition (which actually provides the clustering technology that Exchange uses) for the clustered mailbox servers themselves, but all other Exchange boxes can be Exchange Standard Edition running on top of Windows 2003 Standard Edition.


When it comes to CALs, the Standard CAL gives you everything (and more) that Exchange had in the past; but some of the new functionality, like Unified Messaging or Managed Folders, requires the Enterprise CAL. See the CAL Comparison for more information


Office Communication Server 2007


OCS follows a very similar model to Exchange; Standard Edition server does everything that Enterprise Edition does, except it isn’t clusterable and isn’t designed to scale out to the same degree.


OCS Standard CAL gives you the basics of Instant Messaging & Presence/identity, whereas Enterprise CAL adds voice capabilities (which were previously a separate license for LCS2005), along with new stuff like on-premise Live Meeting data conferencing.


There are other options with OCS… if you want to extend the presence/identity piece out to the public networks (AOL, MSN and Yahoo), there’s a subscription license called Public IM Connectivity.  PIC subscriptions are collected by Microsoft then paid to the public networks in lieu of the adverts that you’d be seeing if you’d been using their own client, rather than Office Communicator).


There are also external connectors for both OCS and Exchange which could allow you to provide services to external users who aren’t part of your organisation (eg giving your clients a mailbox/presence entity).


When Microsoft people say “Enterprise CAL” they don’t always mean it


I often hear MS folk talk about “Enterprise CAL” or “E-CAL”, but they don’t mean the Exchange Enterprise CAL which allows you to use Unified Messaging, or the OCS Enterprise CAL which gives you voice & data conferencing. They’re talking about something that should really be referred to as the Enterprise CAL Suite. It’s a collection of both the Standard and Enterprise CALs for a number of different products, available to buy as a package, depending on what licensing agreement you have with Microsoft.


The idea with Enterprise CAL Suite is that if you decided you wanted the full gamut of Unified Communications, rather than having to buy Exchange Standard CAL + Enterprise CAL (since the Enterprise CAL is an “additive” to the Standard), and also buy OCS Standard + Enterprise CALs, you could acquire all of them along with various others (like Sharepoint Enterprise CAL, Forefront Client Security and many more), for a packaged cost.


In true economic terms, the more you want to buy, the lower the unit costs of each becomes. In buying OCS Standard + Enteprise CAL and Exchange Standard + Enteprise CAL, you’ll have almost spent as much as the Enterprise CAL Suite costs, so going to the Suite will add a whole slew of additional licenses and services that you could take advantage of.


Now, I hope that’s all clear. I think I’m going to go off and lie down now.


Explore the Microsoft Enterprise CAL Suite by







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Business Need


When bean counters start counting things they don’t understand the value of.

I’ve been having a discussion with an old friend, who’s telling me of a large financial institution that have suddenly started getting very picky about spending on IT. Maybe it’s the financial environment right now – the tabloids are desperate to paint a doomsday scenario where all the banks are on the verge of collapse, whereas in reality it’s just a blip out of the norm…

Anyway, this scenario is driving the IT people crazy – instead of investing in IT, the accounts department is back to thinking about how they can reduce the spend.

The other day, I was talking about the Gartner-inspired Infrastructure Optimization models and how they can be used as a way of trying to show what value investment in IT can have – maybe this particular company needs to step up a gear to show their bean counters how short term it might be to slash budgets and expect people to just muddle along.

Reminds me of another story about a company whose penny pinchers decided to stop ordering stationery supplies for the stock cupboards on each floor in the building – the idea was that if you had to go to a designated Keeper Of The Stationery Supplies in order to get something, you’d bother rather less and stop being so wasteful.

What happened in that instance was that people spent so long wandering the halls looking for staplers/pens/paperclips etc, that the move to save a few $$ simply caused huge frustration in the end user and probably cost them a fortune in lost productivity too.

I first came across this particular scenario when I saw a spoof video lampooning the draconian stationery rationing measures.

The company was Microsoft.

Stationery supplies were reinstated in the ensuing months.

Sometimes it takes ground-floor people power to make the spreadsheet jockeys take note 🙂