Case studies support Microsoft's cloud strategy

But Google and Salesforce share success stories, too

As the May 12 general availability date for Office 2010 and SharePoint 2010 approaches, Microsoft executives are out drumming up interest. Tim O'Brien, senior director of platform strategy spoke Tuesday at the SaaScon 2010 conference in Santa Clara., Calif. He was followed Wednesday by David Cutler, general manager of Slalom Consulting, a Microsoft system integrator, who explained to attendees at the software-as-a-service how migrating to Microsoft Online Services worked for three representative clients.

To be sure, cloud providers such as Google, Salesforce and others have similar stories to tell, but this is how Microsoft sizes up the market.

Slalom Consulting helped a large health care provider in the Midwest modernize its e-mail system with Exchange Online. For a health care system with 11 hospitals, 200 total facilities, including clinics and labs, and 28,000 end users, the client had a positively antiquated e-mail system called iPlanet, Cutler explained. IPlanet was jointly managed by Netscape and Sun Microsystems, neither of which is a standalone company anymore. But every time they tried to price out a new system, it broke the health care company's budget.

"Every year they looked at it, they did the cost analysis and they couldn't afford it," he said, of the $10 million price tag for new servers, software, migration costs, not to mention security and privacy protections required for a highly-regulated health care business. But that $10 million was for replacing its on-premise system with another on-premise system. By going with Microsoft Exchange software-as-a-service, the client avoided that upfront cost.

Poor sales efficiency was the pain point another Slalom client was trying to alleviate. A company that supplies chemicals and services to water treatment plants managed sales operations on an Excel spreadsheet but wanted to improve efficiency, effectiveness, collaboration and communication among sales personnel who made up almost half the work force. The solution was SharePoint for collaboration, Microsoft CRM for customer relationship management and Exchange for communication. After comparing offerings from Google and Salesforce, the company chose Microsoft.

"It was all cohesive and all put together and all available in the cloud, and it provided them a very fast time to market," Cutler said.

The third case study was of an existing Microsoft Exchange user, a mid-sized real estate brokerage. The company was having trouble maintaining the stability of their on-premise Exchange environment.

"They had a system that was pulled in all sorts of different directions," he said. "They were looking for ways to remediate that environment and realized the cloud is really a compelling way to begin to offload the burden of their IT system." The company considered Google but chose Microsoft.

Cutler argues that Microsoft can succeed at SaaS offerings and cloud computing because it's many products --SharePoint, Exchange and the like -- are already industry leading solutions in the on-premise environment. Add the advantages of cloud computing -- lower infrastructure costs, fewer management headaches -- and Microsoft is competitive.

It doesn't take too many clicks, however, to find examples where Microsoft lost out to other cloud or SaaS vendors.

Salesforce.com has a Web page of 299 customer success stories and you can bet that a fair number of them are customers who replaced, or at least supplemented, their legacy Windows systems with those from Salesforce.

And the tech news Web site ZDNet.com posts a number of case studies, including ones in which customers dumped Microsoft for Google Apps. The Canadian hotelier Delta Hotels and Resorts replaced its Exchange 2007 system with Google Apps, while electronics manufacturing services provider Sanmina-SCI dumped Exchange 2003 for Google and semiconductor equipment maker Mattson Technology did the same.

The lesson to be learned is that Microsoft, Google, Salesforce and other SaaS/cloud vendors all have competitive offerings. But the question is whether Microsoft will be able to protect its installed base and build upon it in the face of competition from the other players.

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Copyright © 2010 IDG Communications, Inc.