Microsoft is launching Office 365 around the world today, their first real attempt at tackling Google’s online Apps. Office365 is a product that collides Microsoft Office, SharePoint Online, Exchange Online and Lync online into one “always-up-to-date” cloud service, available as a monthly subscription.

Office 365 will likely attract a big audience, since a huge number of businesses use Microsoft products already. But the Office 365 beta, which is now over, engendered some customer complaints, and Microsoft has deliberately held some functionality back from its cloud service to avoid cannibalizing software license sales.

Some beta testers complained about limitations in importing contacts for shared global address lists, and the requirement to use the complicated PowerShell to perform tasks they felt should be simple.

Microsoft CEO Steve Ballmer avoided mentioning Google in his presentation to officially launch Office 365, but certain key phrases indicated the Redmond-based software giant is keen to take on Google Apps.

“Our service level agreement policies… are absolutely the best in the industry,” Ballmer said, waxing lyrical on the benefits of the cloud-based version of its Office software suite, particularly for small and medium-sized businesses (SMBs).

“These businesses really will be able to let their employees share information in new ways and connect in new ways,” Ballmer said, noting that SMBs “need an edge”, without having to invest heavily in IT systems.

“We have developed a wide range of service plans,” that allow customers to pay through a monthly subscription or to connect their existing Office software to Office 365, Ballmer added.

From today, Office 365 is officially out of beta and will be on sale to businesses. Plans start at as little as $6 per user a month. The high end plans (branded as “E” plans) include a subscription to the desktop version of office — Professional Plus — so that businesses don’t need to buy licenses up front. The cheaper plans (branded as “P” plans) are basic, and include email services at the very least, with the options of adding Lync and SharePoint for users.

The below graphic details more on the enterprise plans, so prices may be different than shown. Microsoft also notes that each enterprise plan includes “advanced IT controls [such as active directory integration], security, 24×7 IT support and reliability you expect from Microsoft.”


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Microsoft said. “With Office 365 for small businesses, customers can be up and running with Office Web Apps, Microsoft Exchange Online, Microsoft SharePoint Online, Microsoft Lync Online and an external Website in minutes, for $6 per user, per month,” the company added.

To help it gain traction with the SMB community, Microsoft is partnering with 20 telecoms operators and hosting providers worldwide who “already have established, trusted relationships with millions of small and medium-sized businesses,” Ballmer said.

U.K. mobile operator Vodafone immediately announced that it will offer its customers Office 365 alongside its Vodafone One Net hosted telephony solution.

“Small and medium-sized businesses are the backbone of the European economy and it is imperative that we provide them with the tools to compete with big business in a challenging marketplace where customers expect fast responses 24/7,” said Tom Craig, Vodafone business services director, in a statement.

Microsoft Office has more than 1 billion users worldwide, Ballmer pointed out, giving Microsoft a strong base on which to build.

But the company’s long history of providing software to business customers failed to make an impact on Google, which unlike Ballmer wasted no time in putting down its competitor.

“You can’t just take legacy, desktop software, move some of it to a data centre and call it ‘cloud’,” wrote Shan Sinha, product manager of Google Apps, Google’s equivalent Web-based email, calendar, and documents service for business customers, in a blog post earlier this week.

“It’s worth considering a clean-slate: an approach based on entirely modern technologies, designed for today’s world,” Sinha said.

Microsoft announced Office 365 in October last year and has since provided the product suite in beta version to 200,000 organisations.

Ballmer on Tuesday shared the experience of Travelers Haven, a temporary housing provider in Denver, U.S., which has a staff of 35. The company estimates it could “save $100,000 per year in IT expenditure and cut about 30 hours of work every day across the company,” Ballmer said.

“With Office 365 people can stay connected using instant messaging,” Ballmer said. “They can conduct real-time virtual meetings with co-workers, customers and partners whether they’re around the corner, in the same room or around the globe… Collaboration is absolutely critical to business growth. That’s why we believe the best collaboration technology has to be available to all businesses.”

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A trial is available for 30 days, free of charge at

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