Microsoft tries pricing ploy vs. Google Apps

Analysis
Nov 19, 20082 mins

Microsoft has officially invaded Google Apps’ turf by opening up its Exchange and SharePoint Online products to just about everyone. And as part of the online onslaught, Microsoft is introducing a new a la carte pricing scheme aimed at undercutting Google Apps’ one-price-fits-all model. But buyer beware: there’s more (expense) to the scheme than meets the eye, at least that’s how eWeek’s Clint Boulton sees it.

Microsoft is making its online Exchange and SharePoint suites available for between $2 and $15 per user per month, depending on the features chosen. As Boulton explains it:

A “diskless” worker who needs only to access Outlook e-mail from Exchange will pay $2 per month, while a worker who needs to access Exchange Online, SharePoint Online capabilities and the Office LiveMeeting Web conferencing application will cost a business $15 per month.

The idea is to enable enterprises to pick and choose only the functionality they want, rather than paying one price and getting everything, the way Google Apps is structured. Choice is good, and no user should have to buy software they don’t need. But, Boulton says, if the important issue is overall price, Microsoft’s ploy isn’t as attractive:

Microsoft’s SAAS solutions easily cost companies more money than Google Apps. Microsoft’s pricing model is per user per month, not per year. Businesses subscribing to only Exchange Online for e-mail pay $10 per month, or $120 over the course of one year. That’s more than twice what they would paying for all of [Google Apps] at $50 per user, per year.

So Microsoft graciously lets you pay more for less. That should be an easy sell in this economy.