Yesterday, Microsoft officially announced the availability of a Software-as-a-Subscription service (BPOS - Business Productivity Online Services) for Office Server and Dynamics products world-wide. SharePoint is among the products included in this service offering. While the availability of SharePoint as a Service is not new, the global launch is new, as is the multiple language versions and data center locations. Here are the basic stats:

• Available in 19 markets (check with Microsoft for specifics)
• Five language versions (check with Microsoft for specifics)
• Multiple data center locations for hosting customers will be provisioned in the data center nearest to their "ship to" address

Clearly Microsoft is making progress in enabling their collaboration platform outside of corporate firewalls. The one big case study they promoted was GlaxoSmithKline, who has committed more than 100K employees to the program, with 80% receiving the full compliment of services including Exchange, SharePoint, and Office Communicator (IM). About 20% of Glaxo's employees will be using what Microsoft calls the "deskless suite," which provides a subset of functionality including Exchange access through Outlook Web Access (OWA) and a combination of read-only and read/write access to portions of SharePoint.

While the announcement highlights encouraging moves on Microsoft's part, the SaaS offering continues to suffer from the same general short comings highlighted in the SharePoint Report 2009. During the conference call, we didn't hear any new information on how Microsoft is addressing the challenges identified during the 2008 SharePoint conference (a year ago). Namely, how does Microsoft handle the deeper customizations of SharePoint (that most customers want to make) in their cloud environment? For example, how are custom site definitions handled? Can you deploy Web Parts unique to a given customer (an increasingly common case)? What about the 3rd-party add-ons that Redmond now promotes as part of its ecosystem strategy?

Somewhat predictably, the answer from Microsoft is "Office 14," or, in other words, customers in this environment can expect to wait until well after the launch of Office 14 until those kinds of issues are resolved (if at all). If we assume that the official launch of SharePoint vNext will happen at the end of 2009, it's likely that SaaS customers won't see the update until 3 to 9 months after that.

Sure, customers can opt for a dedicated server and have SharePoint hosted on that environment as a managed service rather than true SaaS. However, doesn't that just transfer a potentially underutilized set of hardware from the customer's data center to a Microsoft-run data center? Where are the saving and the efficiencies gained?

While I very much applaud Microsoft's efforts, I am still disappointed with their "cloud" progress. It's very clear that their strategy will lag behind their product releases and heavily dependent on the architectures of those products -- which today are largely not suited to a cloud environment. In an era of "just in time" updates to products, you have to ask how prepared is Microsoft to support a SaaS environment? Will they continued to be hampered by their relatively slow product development cycles? Clearly these criticisms aren't new, but it's curious why Microsoft hasn't address them in the year since they launched their cloud offerings.