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IT shops scrutinize Office 365 while clutching on-premises apps

Microsoft adds communication and collaboration muscle to Office 365, but IT shops are still concerned about interoperability and costs.

Despite Microsoft’s recent decision to add 30 features to improve the capabilities to Office 365, its cloud-based communication and collaboration suite, IT shops still have reservations about making the leap from on-premises applications.

Those reservations center around Office 365’s compatibility with aging line-of-business (LOB) applications and highly vertical applications, along with some of the unexpected online fees associated with cloud-based services.

“If your LOB app is five or even 10 years old, you may have to upgrade it to the latest edition to get it to work with [the cloud-based version of] SharePoint. You have to look at your vertical industry apps as well -- in our case, key accounting apps -- to see if they support basic things like 64-bit Windows 7,” said Susan Bradley, a partner with Tamiyasu, Smith, Horn and Braun, an accounting firm in Fresno, Calif.

Bradley and others are also concerned with the online expenses associated with Office 365 and a variety of cloud-based services that add up over the course of a year -- costs that tend to be minimized with on-premises applications.

“We are a traditional fat-client shop and are used to the pay-once-and-run-it-until-it-drops model. Moving to a subscription model (with Office 365) with all these little monthly charges, for example, with the cloud-based things we do involving tax research, really adds up. At year’s end we would have to take a close look at what we are paying and what’s its value to the firm is,” Bradley said.

We are a traditional fat-client shop and are used to the pay-once-and-run-it-until-it-drops model. Moving to a subscription model with all these little monthly charges … really adds up

Susan Bradley, partner with Tamiyasu, Smith, Horn & Bruan

Some IT administrators worry the transition from on-premises applications to Office 365 will significantly disrupt well-entrenched workflow processes that could adversely affect productivity among more experienced workers. Retraining such employees not only takes time but also costs money.

“The first thing I look at in making a change like this is how it changes the workflow and who is most involved,” said Eugene Lee, a senior IT admin with a large bank in Charlotte, N.C. “It’s important you give older employees an experience similar to what they are used to with the physical apps, or take the extra effort to guide them step by step. The experienced people tend to be your best producers.”

For other potential customers, lingering questions about security and compliance make them delay purchasing decisions, despite any prospect of Office 365 helping them cut IT costs. Not so for Philip L. Moya, Jr., IT manager at the San Antonio Kidney Disease Center. Even though he signed up for the Office 365 beta, he hasn’t had time to try it yet, though he’s interested.

“I want to find out, financially, can we save money," Moya said. “If it shows up in the browser, there’s nothing for me to install and I’d like that,” Moya added. “It would be a way to potentially save a lot of money,” although he conceded that when it comes down to pricing, it’s always more expensive than vendors would have you believe.

Along with announcing the new features Microsoft intends to add to Office 365, the company said it has signed deals with Campbell Soup Company and Groupe Marie-Claire, publishers of a fashion magazine. Campbell’s intends to use the product to create an improved collaborative workplace across its worldwide offices, while Marie-Claire will deploy Office 365 to access email and share documents across PCs and Macs.

Here are a few of the 30 new features to be added to Office 365:

Admin self-serve password reset. Administrators can reset their passwords through a text message and alternate email address.

Lync client support for the Mac. Users owning Office for the Mac 2011 Standard and usage rights for Lync can download Lync for the Mac.

Windows Phone 7.5 support. Users can access and update documents in SharePoint Online from anywhere in Windows Phone 7.5.

Source of authority transfer.  Office 365 administrators can deactivate and reactivate DirSync to switch between managing their users’ master source of information on-premises or in the cloud.

Among the new features, admins seemed most pleased with the self-serve password reset. “With Office 365, every time 47 different people forget their passwords they have to email me,” Bradley said.

Stuart Johnston is Senior News Writer for Contact him at
Ed Scannell is Executive Editor for the Data Center and Virtualization Media Group at TechTarget.

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