Microsoft Office 365 Preview: Hello Lync, Goodbye Live Meeting

Microsoft's Office 365, now set for rollout on June 28, will swap out Office Communications Online and Live Meeting for the new Lync Online, while also improving the online editions of Exchange and PowerPoint, an analyst said this week, during a preview of a new cloud-based office suite aimed at tailorability to businesses of all sizes.

"Lync Online will be about collaboration," contended Wes Miller, research VP for server applications at Directions on Microsoft, during a Webcast held just a few days before the impending launch.

Lync Online will supply instant messaging (IM), user presence, and online meetings, complete with audio, video, and screen sharing. Yet unlike Live Meeting, a component of Office Communications that supported online meetings among up to 2500 participants, Lync online will only allow about 250 people to collaborate at a time. Live Meeting will now start to fade into history.

Microsoft might have found out through customers that most companies don't hold online meetings with over 250 people, anyway, Miller theorized. "Beyond that, it becomes a Webcast, not a meeting," he noted.

Now in beta since April, Office 365 -- a replacement for Microsoft's earlier Business Productivity Online Suite (BPOS) -- will offer some definite advantages over the "on premises" Lync, Exchange, and PowerPoint, which require businesses to run their own dedicated servers, according to the analyst.

The benefits will include "almost instant deployment of applications vs. on-premises," along with "per user/per month predictable spend" and "no long-term investment/depreciation of hardware."

For end users, Office 365 will "build upon familiar applications and experiences," according to Miller. Companies can generally expect "lower user retaining and migration costs than with Google Apps."

On the other hand, he admitted, businesses deeply concerned about keeping sensitive data inhouse -- or about meeting regulatory requirements -- might not be comfortable about stepping to Office 365 or any cloud-based office environment.

'Lync is probably the biggest gap"

Moreover, the feature sets of the Microsoft-hosted editions aren't yet completely on par with their on-premises cousins, according to Miller. "Lync is probably the biggest gap," he illustrated.

In contrast to the Lync on-premise server previously released by Microsoft, Lync Online will not include the integrated built-in telephony support that Microsoft's Bill Gates foresees as ridding businesses of the need for PBXes and those pesky old-fashioned desktop phones that are still limited to voice calling only.

Instead, Office 365 isn't anticipated to add this server-based telephony support until the end of this year, or even later -- and even then, only in its most pricey package, which will be known as E4.

Through this server-based telephony, the "on-premises" Lync lets users collaborate through both voice and data from smartphones such as Apple iPhones, as well as from specially outfitted desktop phones.

Right at the outset, Lync Online will allow for both voice- and data-based collaboration, but only on a "PC-to-PC" basis, according to Miller. Yet the analyst also speculated that Microsoft might ultimately build in some new VoiP (voice over Internet protocol) capabilities obtained through its recent Skype acquisition. 

Web Apps vs. Office 2010 Pro Plus

Additional Office 365 packages will include E1, a direct replacement for BPOS; E2, an edition that will add Web apps to BPOS; and E3, which rolls in Micorosft Office 2010, plus some ECAL features.

Microsoft will also offer a "Small Business" (P1) package, along with two packages, K1 and K2, for so-called "Kiosk Workers." Priced at $4 per user/per month, the K1 package will support Exchange/SharePoint Web access. At $10, K2 adds Office Web apps.

The Small Business (P1) hosted services, on the other hand, include Lync, Exchange, and SharePoint -- although only through "a very simple Web site" -- along with Microsoft Office Web Apps.

Priced at $6 per user/per month, the P1 level services are theoretically designed for up to 50 users. However, according to Miller, even a very small business might opt for "E" instead of "P1" services under certain circumstances. (In case you're wondering, the "E" in Microsoft's packaging scenarios stands for "Enterprise.")

"To my knowledge, the minimum number of licenses required for E is 1. So the principal thing that would preclude a small business from going with an E package is most likely the price, Miller wrote, in an e-mail to TechTarget/TechnologyGuide.

As examples of very small businesses that might opt for "E" rather than "P1," Miller cited companies that need "features only available in E," such as Office 2010 Pro Plus, and those that are either "right on the edge" of P1's 50-user limit or that expect to surpass it soon.

Microsoft's Office Web Apps provide some but not all of the same functionality as Office Pro Plus, Essentially, the Web Apps are for "document viewing and simple editing/creation," he elaborated. The Excel Web App can't run macros, add charts, or open Excel 2003 .xls files. Also, the Web Apps will work online only.

Miller added that, in his experience, the Web Apps work well with Firefox and Microsoft Internet Explorer (IE) browsers, but sometimes glitchily with Google's Chrome browser.

Microsoft, however, will also support some earlier editions of Office for Windows desktop applications -- along with Office 2007, 2008 and 2011 for Mac -- for connectivity to Office 365, he said.

'Licensing story can get complicated'

Additionally, although "E" services at all levels will be available in entirely Microsoft-hosted scenarios, Miller suggested that the services will often be deployed through shared hosting, with companies augmenting Microsoft's cloud with software running on their own servers.

"None of the packages 'require' an on-premises server -- but generally life gets easier, especially as an organization grows, if on-premises servers are there," he told me.

Pricing for the E packages will vary considerably, according to Miller. "The licensing story for Office 365 can get rather complicated rather quickly," the analyst observed.

Also during the preview, Miller outlined the main strengths and weaknesses of the Exchange Online and SharePoint components of Office 365.

The new Exchange Online, for example, provides a 25 GB mailbox with Outlook and Outlook Web App access, mobile e-mail for most devices, and shared calendars, contacts, and tasks. Voicemail has been added for unified messaging (UM). On the other hand, support is absent for unlimited message size, managed folders, or public folders.

SharePoint Online offers external connectivity for partners and off-premises workers. Support is available for Microsoft Access, InfoPath Forms, and Visio Services. Microsoft has now added document-level permissions. However, the new online edition doesn't support PowerPivot or other business intelligence (BI) features, and it doesn't provide search integration with Exchange, FAST, or Windows 7 search, the analyst said.