It looks like email could well be the next battleground for Microsoft and Google to fight over market share.

As organisations evaluate e-mail strategies over the next five years, Microsoft and Google will compete for the bulk of the market, says analyst Forrester Research. This is due to cloud-based e-mail being the cheap entry point to a deeper and more profitable collaboration deal for vendors. Microsoft and Google will be happy to outbid each other to win your e-mail business because they know there’s more money to be made in conferencing, team sites, videoconferencing and social software down the line. Cisco, IBM, Microsoft and Google are rapidly approaching feature and price parity in their e-mail offerings.

Research from Forrester found that in 2009, 76% of US employees in small companies used Outlook for e-mail. However, Google has been building its direct sales organisation and partner channel aggressively over the past three years - claiming more than two million businesses use its Google Apps Enterprise Edition product.

So anyone facing the prospect of signing another 3 year Microsoft Select or Enterprise Agreement may want to consider their options more thoroughly The future is cloud and the question is only when do you go there, not why.

Just when you thought it was safe to go back into the water…..here comes another Microsoft bug fixing release. Microsoft has just released 11 patches in its April security update to cover 25 vulnerabilities across a range of operating systems and software packages. Although this is a big release, IT administrators probably will not have all of the included software packages and configurations installed in their environment and therefore will need to install only a subset of the 11 bulletins. But five of the patches are critical, involve remote code execution and affect all major versions of Windows software. They could cause an interruption in services affecting workflow and productivity levels. Can you imagine a world where Microsoft releases some new software and it works perfectly from day 1?

Office 2010, the latest version of Microsoft’s office productivity suite, will ship to business users on 12 May. The product tackles document sharing by using SharePoint 2010 to allow users to share Office documents. It also features Office Web Apps, which enables users to view and make light edits to Word and Excel documents through their browser. Microsoft Office 2010 also allows users to work offline through new software - SharePoint Workspace 2010. According to Microsoft, when users reconnect their laptop to the network, the changes they made while offline will be synchronised. Businesses and consumers who purchase and activate Office 2007 - or a new PC running Office 2007 - between 5 March 2010 and 30 September 2010 will be able to download Office 2010 at no additional cost. To qualify for the free upgrade, users also need a Windows Live ID and must claim it before 31 October 2010 by visiting Microsoft’s Technology Guarantee page.

Upgrade prices were mysteriously absent from Microsoft’s Office 2010 pricing information, which they revealed last week. Microsoft has said “we are not offering upgrade pricing for Office 2010. Based on partner and customer feedback we’ve made many changes to the Office 2010 line-up designed to simplify the product line-up and pricing in the retail space. Removing version upgrades was one of those decisions. This reduces the number of products that our retail partners need to manage and also reduces customer confusion about which version of Office they should purchase.” This seems like a straightforward answer: take the upgrade option away, and customers can only pick a full retail copy. Of course, this does mean customers have to pay more to upgrade to the new version of Office.

Windows 7 owners are having problems installing their new operating system, especially over Vista, according to comments on Microsoft’s support site. Many find their installation goes into infinite reboot after 62% of the installation is complete. Switching off and rebooting doesn’t help either because the system no longer recognises the older operating system. Microsoft says the problem occurs because the Iphlpsvc service stops responding during the upgrade. But others may also be to blame. One user who followed Microsoft’s fix said it took 48 hours to get a working installation, with installation runs taking 10 hours a time. Even then he had to delete his wireless card and get the operating system to find it again. Sounds like something to be avoided until Microsoft get their bug fixes sorted.

Rentokil Initial has become one of the largest users of Google Apps, rolling out the cloud-based office suite to 35,000 users globally. Rentokill plans to use Google to consolidate 40 email systems including open source products and Microsoft Exchange, into a single email system. Last year, Rentokil Initial deployed handheld computers. It installed a new network in the UK and is in the process of virtualising servers, rationalising data centres, standardising its PC infrastructure and moving to a single mobile telephony provider. The company aims to rollout Google Mail to 35,000 during 2010. Earlier this year, manufacturer Valeo became the first company to use Google Apps globally after it signed a deal to use the SaaS for three years.

While these two deals may only show as a miniscule dent in Microsoft’s vast sales revenues, it is the thin end of a growing wedge of businesses that are looking beyond Microsoft products for robust global apps and solutions. Alternative products ramp up competitive pricing pressures on Microsoft and give users a chance to demand better deals and better pricing. Silver Bullet Associates encourages everyone to watch this space; Rentokil and Valeo will not be the last to replace Microsoft products for alternative solutions.

Microsoft’s CEO Steve Ballmer has ruled out reviewing its user licences, despite acknowledging the fine print and complexity can cause headaches for customers.“I don’t anticipate a big round of simplifying licences. The last round of simplification was done six years ago” he said. Ballmer has also said that the supplier was working hard to ensure the launch of Windows 7 was more successful than Vista. “My hope is that in the first three to six months [after launch on 22 October 2009] any new PC you buy will come with Windows 7. It would be a shame to see people acquire Windows XP machines in 2010,” he said. Whether Windows 7 takes off quickly or stumbles like Vista remains to be seen. It would be nice if Microsoft were to simplify its licencing terms; but don’t hold your breath. And it would be great if Microsoft were to acknowledge their pricing policy was unreasonable too. The next few years will become increasingly tougher for Microsoft as competitive products such as Open Office and Google Apps take chunks out of their revenues. Maybe Windows 7 will be the last great revenue hurrah for Microsoft before a long slow revenue decline sets in.  

Many software vendors are now embracing licencing metrics that incorporate the requirements of a virtual environment. Oracle, Microsoft and IBM are just three of the many vendors who have accepted that they have to move away from tying their software licences to physical devices or processors. Licencing software in a virtual environment based on processors can add up fast so it’s a good idea to look at negotiating software licences based on named users.  Data volume is going up fast for many organisations which in turn requires more processors, even though the number of actual users may stay the same or actually be decreasing. And one other point; Silver Bullet Associates is aware that some suppliers support contracts are not written to incorporate virtual licences and could cause a cost problem when the supplier insists the client revert the support contract from virtual to physical licenses before addressing the original issue.

Mirosoft Windows 7, due to ship on 22 October 2009, has received good reviews as the Operating System that Vista should have been. And it would appear that the large percentage of businesses that have held onto XP rather than go to Vista are no doubt planning to migrate to Windows 7. But Microsoft may be making it harder and costlier for them to do so. Under Microsoft’s planned enterprise licensing rules, businesses that buy PCs before 23 April, 2010, with Windows 7 preinstalled can downgrade them to Windows XP, then later upgrade them to Windows 7 when they’re ready to migrate their users. But PCs bought on or after 23 April 2010 can only be downgraded to Vista which will be of no help for XP-based organizations and could cause major headaches and add more costs to the Windows 7 migration effort.

Microsoft laid off 3,000 workers last week in the second wave of a major reduction announced in January. And in a memo to employees, CEO Steve Ballmer said more cuts are possible.  “As we move forward, we will continue to closely monitor the impact of the economic downturn on the company and if necessary, take further actions on our cost structure, including additional job eliminations,” Ballmer wrote. In January, Microsoft had disclosed plans to eliminate 5,000 positions, more than 5% of the 96,000 full-time workers it employed at the time. And what about Microsoft’s clients? Don’t they all have pressures on their cost structures? Wouldn’t it be a magnanimous gesture if Microsoft were to cut the cost of their products and so provide financial help to PC users across the World?