Hosting News
Microsoft.com Pay-as-You-Go Office
2008-05-04
Microsoft has finally listened to the masses, it is looking to provide its
outstanding Office software over the internet.
Many observers will see the move as a new salvo in the Microsoft’s titanic
struggle against Google Apps and other online challengers to its desktop
application franchise. An early trial-run of the scheme saw Office offered for
as little as $10 per month, with no contract commitment.
Expected on June 1st or shortly afterwards, the long-awaited change to terms in
the Service Provider License Agreement (SPLA) will lift a longstanding ban on
the use of technologies that stream the software code from the server to run
locally on the client PC. Previously, the SPLA only allowed pay-as-you-go terms
for desktop applications that run on the server and are accessed remotely using
a Terminal Server client.
The change will make a huge difference to the appeal of hosted Office, according
to Neil Gardner, VP of marketing for Endeavors Technologies, one of the vendors
offering products that enable and manage the application streaming process. “It
completely changes the model of offering Office applications to either the
business or the end user,” he told me yesterday. “It becomes a true on-demand or
pay-as-you-go model.”
Although a few providers have had some success with Office products delivered
using Terminal Server, most have failed to gain significant market traction, in
some cases suffering huge losses and embarrassing market retreats. The majority
have chosen to concentrate on delivering Exchange and SharePoint as well as
basic Microsoft web hosting, all of which are now available from Microsoft in
multi-tenant versions designed explicitly for the service provider market — with
Dynamics CRM soon to be added to the line-up. But many will see Office streamed
to customer’s PCs as the icing on the cake, Gardner believes.
“Talking to service providers, this will make a huge change to them,” he said.
“Many are holding back because they don’t think they will have a viable offering
if they don’t offer the Microsoft applications. Office is the one everyone seems
to be interested in.”
The change will initially be for a 12-month pilot restricted to Office Standard
and Office Pro Plus, but Gardner claimed the plan is to extend it to other
applications. He believes Microsoft’s SPLA moves may also force the hand of
other desktop application vendors, especially in the case of applications whose
retail price deters casual or infrequent users. “This pay-as-you-go model is
more applicable to higher priced applications such as Adobe PhotoShop or
Microsoft Project,” he said.
The move is a controversial one internally for Microsoft, as it undermines the
one-license-per-machine philosophy that underpins Microsoft’s conventional
software licensing, making it possible to switch a license from one PC to
another effectively on demand. That controversy briefly surfaced earlier this
year when UK service provider Fasthosts began running an early pilot of the new
SPLA terms with prices starting from $10 per month, only to be accused of
breaking its license agreement by Microsoft’s anti-piracy unit. But developments
such as the recent introduction of Live Mesh, which will enable applications to
be associated with individual users or businesses rather than specific devices,
are also challenging the conventional licensing regime.
The encryption and code packaging technologies employed by products such as
Endeavors’ Application Jukebox have helped to allay Microsoft’s concerns about
the potential for software piracy, said Gardner. Application code is streamed to
the PC as needed — less than 10 percent of the code in Microsoft Word is needed
to get started on editing a document, for example — and the encrypted parcels of
code from all streamed applications are stored in a single cache managed by the
proprietary streaming software. “The order of magnitude of computational power
required to recreate the original binary is immense,” said Gardner. The client
PC keeps in regular contact with the streaming server, and once the licence is
no longer valid, the cache is emptied, using persistence rules set by the
provider.
Although the code runs on the client, the technology ensures that use of the
software remains under the control of the provider, who also remains responsible
for managing the implementation and any required patches. This hybrid serviced
or virtual client model, as I’ve argued before, is one that could be extended to
other cloud-provisioned architectures and (especially in the context of Live
Mesh) is a potential mechanism for bringing Microsoft’s desktop franchise into
the cloud.
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