Microsoft hasn't spilled the beans about Office 365 sales, but the little information we do have makes it sound to me as if the cloud suite isn't doing well at all.
In spite of a spate of minor announcements yesterday, Group Product Manager Andrew Kisslo noted on the Office 365 blog, "Just five months after its release, Office 365 is being adopted eight times faster than its predecessor."
Keep in mind that Office 365's predecessor is BPOS -- and BPOS didn't exactly get off to a dizzying start. Back in 2007 and 2008, Microsoft hosted Exchange and SharePoint in an ad hoc way. Microsoft didn't give the service a name until November 2008, when an amalgamation of Exchange and SharePoint was packaged and sold as Microsoft Online Services, a precursor to BPOS. Microsoft has never divulged how many BPOS customers it signed on in the five months after its launch, but the number of organizations using Microsoft-hosted servers in April 2009 certainly wasn't stunning.
According to Microsoft, "more than 90 percent of Office 365 customers are small businesses with fewer than 50 employees." A company spokesperson confirmed that "customers" in this case refers to the number of organizations that have signed up, not the number of domains or users. There's no indication as to how many employee seats are licensed, so we're still very much in the dark about the total number of active Office 365 users.
The company announced that "over 40 percent of the Top 100 Brands (according to Interbrand) use Office 365 or related cloud productivity services from Microsoft." A Microsoft spokesperson also noted that "1 in 5 of the Fortune 500... have Microsoft's productivity cloud service." Neither of those statements differentiate between BPOS and Office 365.
In spite of the upbeat report, there's no way of telling how many user seats are signed up for Office 365.
The rest of yesterday's announcement said there are "30 new updates to Office 365." The "new" updates include Windows Phone 7.5 support, which was part of last month's Windows Phone 7.5 Mango feature set; a Lync client for Mac OS X, which was released in September; Dynamics CRM Online integration, which was promised last year; and the ability to reset admin passwords using SMS messages.
In related news, SkyDrive boasts several worthwhile improvements, although they aren't part of Office 365 itself.
There's still no sign of Lync for iPhone, iPad, Android, or Blackberry, although Microsoft promises they "will be available by the end of the year."
Office 365 remains a work in progress. And nobody outside Redmond really has a clue how well it's selling.
Update: On Sept. 14, Microsoft COO Kevin Turner did release some Office 365 sales figures. According to the transcript of his talk with financial analysts, "we have over five million seats already signed up, and we've deployed around 2.8 million already." It isn't clear how many of those seats originated as BPOS customers. By contrast, Google Apps claims "40 million active users from 4 million businesses and universities."
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