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Hosted Collaboration Services: Does Pricing Matter to Your Business?
Microsoft is reportedly cutting prices of its hosted Exchange Online service in half, from $10 per user per month to $5. The company is also reducing pricing of its Business Productivity Online Suite (hosted versions of Communications, Exchange, Live Meeting and SharePoint) from $15 to $10 per user per month. But competitive offerings such as Google Apps are available at prices starting at free. Does pricing matter to adoption of such cloud-based hosted services at your business? Why or why not?
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3 Answers
I think there are 3 factors that determine the utilization of collaboration services: functional capability, adoption, price. Functional capability determines if the tool/service is worth considering. Adoption determines if it will be usable based on who else is using it. Price is important as a qualifier if functionality and adoption are equal. Lower cost does affect how much people will try a new technology/service and does affect adoption.
I think there are 3 factors that determine the utilization of collaboration services: functional capability, adoption, price. Functional capability determines if the tool/service is worth considering. Adoption determines if it will be usable based on who else is using it. Price is important as a qualifier if functionality and adoption are equal. Lower cost does affect how much people will try a new technology/service and does affect adoption.
People who don't trust online services won't sign up for $10, $5, or free. But outside of that group, Microsoft's price drop seems to signal they're serious about this project, and that they're willing to backstab all their partners already offering hosted Exchange services. But with the MS name, perhaps a few companies staying out of SaaS might jump in, but I don't predict that will motivate many to overcome their fears for a few dollar discount.
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