Status

And speaking of these, as I did last Friday, Microsoft has an entry on that side (the positive side) of the ledger as well. They have announced the general release of their Hosted Exchange and Sharepoint online services this week, providing you with exactly the sort of alternatives you should be looking at to running internal bloatware like the new SBS or EBS servers.

Microsoft Online Services has gone from beta to release, offering completely hosted versions of their popular Exchange and Sharepoint products, as well as Office Live Meeting (for web-based conferencing) and Dynamics (Customer Relationship Management software). A host of ancillary services for Exchange are offered as well, from anti-virus and spam scanning to archiving.

Exchange itself is offered starting at $10 per user per month, which is double that of Google Apps Premier Edition (which includes Gmail), but considerably less than you probably pay in total to host Exchange on premises. It's competetive with existing hosted Exchange solutions, which have been offered by third-party service providers for several years now. Sharepoint is offered for $7 per user per month, which may or may not be a good value to you depending on whether or not you have found a successful process model that uses Sharepoint.

You can also get those, and the additional Exchange services, bundled for $15 per user per month, which is right in line with most existing Exchange hosts and provides much of the same functionality.

The reasons you might select Microsoft to provide this service for you are several. One, if you haven't already explored it but think the idea is appealing, presumably having the Redmond software giant hosting its own software might boost your confidence in the matter. Two, even if you don't like the concept so much, the fact that Microsoft itself is cannabalizing its existing Exchange market should tell you something about the direction the software industry will be going with services of this sort. That's right... they're going to be going online for the most part. For all that detractors of the idea hem and haw over the supposedly ephemeral nature of hosting providers, they haven't put much consideration into the concept that traditional software may be just as ephemeral... you may stop seeing Exchange released as a viable stand alone product, some day. Not soon, no doubt, and no doubt you will always be able to purchase it for your premises in some form or another (even as you could probably, for enough of an outlay, set yourself up with a really fine mainframe system today) because there will always be certain circumstances that require it, but on the whole, Software as a Service is an idea whose time has come. You're on board for the next paradigm shift in general computing.

Like the others, this will result in some upheaval, have some growing pains, but will generally reduce your costs and improve your efficiency over time. But the good news is that the kinks are already out of e-mail hosting, and this is a bandwagon you can jump on safely today. Whether you use Microsoft or not, if you need Exchange, stop thinking about a new server and a fresh copy and client licenses for Exchange 2007, and start thinking "hosted solution."

Microsoft has released its bifurcated successor to the popular Small Business Server (SBS) software, SBS 2008 and the new Essential Business Server (EBS). SBS continues to be aimed at small businesses, with EBS now intended to address the mid-market of up to 250 user organizations. Pricing is higher for both products than their predecessor, SBS 2003.

Microsoft seems to be going with a new and innovative marketing message this time around: Although the pricing is higher and the requirements are more stringent, the restrictions are also greater! The base price of SBS has almost doubled, from $599 to $1089 for the most basic package. But not only are you paying more for that, if you get the premium edition (including SQL Server) or EBS, you also have the privilege of paying for another whole server or two to run them on. You're not allowed to run them on the same box even if you have the space and processing capacity to spare (and chances are, in a small business environment, that you do). That's right--they get you coming and going. And on top of that, the user cap for SBS has been lowered from 75 to 50, so you can have fewer people using all that stuff you paid more for.

On the plus side, licensing has been simplified somewhat, and Client Access Licenses are now much more in line with the utilization scenarios one might expect in a small business... although to be honest, I don't know any small businesses which have ever truly understood the CAL concept as Microsoft presents it in the first place, and I doubt they will start trying to decipher it now.

This is all strangely at odds with the otherwise excellent progress that Microsoft has been making with its server products. Virtualization has been the watchword in every other aspect of the server group, allowing customers to maximize the bang for their processing buck. Licensing has been simplified and made more expansive, as a rule. But as has been historically the case, it seems that the small business market is suffering from terrible lag behind the cutting edge of technology application and theory, and at a time when it has never been more important.

I first mentioned the products back in February, commenting that I wasn't thrilled at the decision to require separate physical servers to run the various components of EBS. Normally I am willing to give new products some benefit of the doubt, and wait until I have a chance to work with them directly before passing judgement. In this case, I feel that the core premise of the product is flawed, and that even if it performs as advertised, it's not in any way worth the cost.

Microsoft has long benefited from product lock in at many levels, and SBS in the small business market has been no exception. There simply aren't other good backend-product-in-a-box server solutions out there. But what there are now that there were not when SBS 2K3 was released are a plethora of SaaS and online options to meet the core business needs that the SBS family has traditionally addressed. In between Mail2Web, Google, Salesforce and the like, there is very little that cannot be addressed for the SMB off-premises today... and cheaper, in the bargain. It's transition times such as these during which busiensses explore their options, and while they may normally be inclined to take the path of least resistance and simply upgrade to something they know, the economic climate today is such that cheaper solutions are more likely to get a longer hearing.

I won't rule SBS 2K8 or EBS out completely, because I'll always weigh the options against the client's particular requirements, but I will say it is extremely unlikely that I will be recommending or installing these for anyone in favor of more modern, flexible SaaS solutions.

With the price increase, though, there is another intriguing option that is back on the table: Apple's OS X Server. Priced at $999, it offers unlimited licenses, and there are no such thing as CALs. You are of course restricted to Apple's hardware as a server platform, but their XServe is not priced outlandishly for the specs... you may find yourself spending the same amount for your SBS/EBS hardware (times two or three!). And Apple has been pushing to introduce more business oriented features of late, including mail, calendaring, and centralized client management. Their Windows integration has improved dramatically, and their administration is oriented at non-technical users. This is not necessarily going to go far enough to get them into the enterprise market, but it happens to include a lot of things that the small business operator looks for.

If I have not yet been entirely vindicated in my call for most of my clients and other businesses to save a buck by skipping Vista in favor of the next version of the Windows operating system, now officially known as Windows 7, I am at least basking in the knowledge that day is coming. With Microsoft's unveiling of pre-release builds of 7 at the Professional Developer's Conference in Los Angeles last week, and the subsequent uniformly positive reviews, it is looking increasingly like Vista will be a short-lived relic to be tucked into Microsoft's closet with the skeletons of Windows Me and the Microsoft MP 900 Cordless Phone System. If you managed to avoid buying it during that relatively short period when Microsoft was frantically urging you to do so, you will look back on that as money well-saved.

As an added bonus, every indication is that Windows 7 has an excellent chance of being shipped earlier than the announced 2010 release date, making the wait between when you bumped yourself up to the pretty-decent XP release and when you get your hands on the new tech goodies shorter than it might otherwise have been. Shorter than the evolution of new applications which will make full, productive use of the new technology, certainly... Vista has never had a "killer app" which requires its use from a technical standpoint to take advantage of, so you weren't missing out on anything groundbreaking not to have installed it.

Microsoft is still suggesting that your best upgrade path to 7 lies through Vista, but at this point, what else can they say? "Ah, we're just funnin' ya', Vista was a joke, go ahead and wait a bit and we'll get you the real next generation operating system!" The argument they are making is that internally, 7 and Vista are similar, so you will not experience the upgrade issues which some people did going between XP and Vista. But this is absurd even on the face of it; if you upgrade to Vista, you're still going to have to work through those problems... you aren't avoiding any pain and suffering. It's just going to cost you more than if you wait and do the suffering with 7. But even that isn't the whole story... the time between now and 7's release is undoubtedly going to be put to good use by application manufacturers who will ease the transitions for their applications as much as possible in order to keep customers happy.

There is an extremely informative review available on ActiveWin if you are interested in such detail, but all you really need to know as a decision maker is that it looks good so far.

So stick to your guns! Hold out on XP for another year, and save an entire upgrade cycle worth of costs and aggravation.

Microsoft's annual three-day Small Business Summit starts today, again as last year an online-only event.

I went to the last live version of this a couple of years ago and was reasonably impressed by both speakers and topics, but last year's lineup left me underwhelmed, and from what I can see of the agenda this year it is more of the same... a lot of people you never heard of speaking with questionable authority on a lot of things you probably already know about or don't care to know about. The summit is broadly divided into Sales and Marketing presentations today, Productivity and Security tomorrow, and wrapping up with Financial Management on Thursday. It might be interesting to see how many of the canned Financial Management presentations line up well with the current econonomic situation. Otherwise, I will probably be skipping most of the show.

But it's free, and if you're bored and have a fast web connection, by all means check out the agenda and listen in on whatever interests you.

I am firmly of the opinion that you should run your business as efficiently as possible all the time, not simply when it becomes a requirement to do so; belt-tightening is a bit silly when you think about it... why weren't you improving your profit margin by cutting all that fluff years ago, instead of waiting until the econonomy forced you into it? But it's hard to live by that rule, particularly when times are flush. And so it is that many businesses now, rightly concerned by the deepening global financial crisis, are looking to tighten up operations and cut corners. Many, because they see IT as a cost center rather than a competitive advantage (which is often actually the case) are looking to cut their IT budgets and trim staff and services.

For those just getting on the cost-cutting wagon, welcome aboard! It's a great time to do it. Six or twelve months ago might have been better, but let's not quibble, shall we? Instead, embrace lightweight, agile operations in this time of uncertainty! Get rid of expensive, difficult-to-maintain, investment-up-front, in-house services... outsource! Outsource responsibly, of course... you don't want your CRM provider going out of business on you. But one of the best ways to cope with uncertain times is by provisioning with scalable services. It's madness to invest in a new e-mail server for extra staff you are bringing on today when you may be laying them off in six months... that's 10 grand you're not going to be getting back anytime soon. But provide them with service from Google, or Mail2Web, or any of a dozen other service providers, and you can cut the expense as soon as you cut the staff.

Structure even internal IT projects so that you can maintain your flexibility going forward. You have think of your systems as building blocks, rather than bulky, complex systems. Don't get committed to anything you don't have to; if you don't need a massive new database system to track your widgets, don't get into it just because you might someday. Do the minimum... while planning to support the maximum later.

If you do these things now, you'll come to see that it's to your advantage to do them always, not just in times of trouble. The danger at the moment is that, in a panic, you will make cuts in places which you should not, and cripple your IT systems moving forward. Although it's a great time to cut costs and restructure, it's vital to avoid doing so blindly. Take the time, and spend the money, to get a careful, professional analysis of your systems and needs before you start chopping away at them.