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VARBusiness: Microsoft To Host Office Over The Net

Sep 02, 1999, 23:05 (4 Talkback[s])
(Other stories by Paula Rooney)

"Microsoft, which is putting the final touches on its server-hosting plan, now is turning its attention to the front-office side of the business.

As part of that, the Redmond, Wash.-based company will host its leading Office productivity suite for online or subscription use, Microsoft President Steve Ballmer said today. The action comes just days after Sun Microsystems Inc. unveiled plans to make its newly acquired StarOffice suite available for rental use via its StarPortal site. "

"Privately, Microsoft is fine-tuning a major application hosting service it plans to detail in late October or early November, sources said. Microsoft is chiseling away at a per-user, per-month subscription model that will be 'revenue-neutral' for the company and also will please ASPs, which are insisting on three-year subscription commitments to recoup their investments.

Some industry observers said Microsoft is embracing the subscription model very reluctantly as it tries to preserve a major cash cow, Office, which nets more than $3 billion each year."

"One Sun executive said Microsoft had no choice but to match Sun's StarOffice offer because many in the small- to midsize-business segment -- the fastest-growing in the market -- likely will opt to outsource their IT infrastructure and applications."

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