Microsoft has taken another big step into the SaaS market by pushing it's "Business Productivity Online Suite" (BPOS) out in 19 countries. This is Microsoft hosted Exchange 2007, Sharepoint, Live Meeting and Communications Server - degrading partners to mere resellers with a slim margin (from what we hear 12% of revenue of first year, 6% thereafter).

So, what was long announced is finally happening - Microsoft is biting out a big chunk of the food-chain from Service Providers. While the offering is not exactly cheap for end-users, in the range of 15 EUR/USD per user/month, it certainly is shrinking margins of current Hosted Exchange providers significantly.

Time to act, as many of our partners have done and are doing. Not only can an Open-Xchange based offering be much cheaper per user/month for the end user, it also provides a healthy margin for the provider. Oh, and the Open-Xchange business model is strictly indirect, because we believe that the combination of our software combined with the strengths of the Service providers - customer ownership, mass-market hosting and services capabilities, marketing and sales leg - we all can be more successful.

Let me end with what Tier1's Phil Shih has to say:

"...There is no question that Microsoft is going to start making its presence felt. After all, it is hosting these online services. Partners are merely reselling them. ... That means the time is now for hosters to jump in and do what needs to be done, consolidate relationships with customers and create niches and reputations for themselves in the market..."