Microsoft selling web-based programs
Microsoft Corp., looking to sell more of its software online, released Internet-based versions of its Exchange and SharePoint e-mail and collaboration programs for smaller companies.
The company also said it has won more than 500,000 users at customers such as Pitney Bowes Inc. for a version aimed at larger businesses, introduced last year. Two-thirds of those switched from rival products, mainly International Business Machines Corp.'s Lotus program, Microsoft Senior Vice President Chris Capossela said today.
The programs are part of Microsoft's campaign to steal customers from IBM and fend off Google Inc., which also provides Web-based programs for business users. Microsoft, the world's largest software maker, expects about half its SharePoint and Exchange customers to switch to the Web versions in five years.
Interest in the Microsoft programs is increasing as companies cut spending to cope with the slowing economy, Capossela said. The service lets companies host software on Microsoft's servers rather than their own networks, potentially making it cheaper and easier to run applications.
Smaller customers can save as much as 50 percent of the cost of a competing program by switching, while the largest firms can cut their spending by about 10 percent, he said.
Microsoft, based in Redmond, Washington, fell 74 cents to $19.32 at 4 p.m. New York time on the Nasdaq Stock Market. IBM slid $2.85 to $77.48 on the New York Stock Exchange.
Philips, Maersk
As of today, Eddie Bauer Inc. replaced Lotus Notes with the Web-based version of Exchange for 1,400 workers. Microsoft also persuaded Royal Philips Electronics NV and A.P. Moeller-Maersk A/S, which has about 125,000 workers using the Microsoft programs, to switch from Armonk, New York-based IBM.
Microsoft's Exchange has 52 percent of the market, compared with 38 percent for IBM, according to market research firm IDC. That's stayed about the same for the past few years, said Mark Levitt, an IDC analyst.
The Lotus business is healthy and has taken customers including Global Hyatt Corp. away from Microsoft, IBM spokesman Mike Azzi said.
IBM, the world's largest computer-services provider, said last month that it's offering to manage the Lotus messaging system for its customers in a bid to increase sales of Web-based services. It also provides a service called Bluehouse that combines employee collaboration, content sharing and social networking for smaller companies.
Microsoft also sells a Web-based version of its software for corporate instant messaging to large companies, and will begin testing it for smaller firms next year, Capossela said. In the next year, the company plans to add an Internet-based product for securing and managing corporate desktop computers.
``This is a generational shift in how people will be doing computing in future,'' Microsoft Business Division President Stephen Elop told Bloomberg TV today. ``It's critical for Microsoft to lead broadly in this area.''
Microsoft announced the products' release today at an event in San Francisco.