Managed Services Strategy Broadens

Prodded by competitive pressures and financial imperatives, Microsoft’s managed services plans are evolving. The company now plans to offer hosted desktop management services and hosted versions of Microsoft server software to a wide range of customers, and expects many business customers to be using these managed services offerings-purchasing them either from partners or from Microsoft itself-within 10 years. Customers and smaller partners may benefit from the change, but large partners who provide managed services today could find themselves competing with Microsoft or relegated to less-profitable parts of the business.

Moving Past Trials

Microsoft’s most notable effort so far to directly provide managed services for customers is a contract with Energizer Holdings, followed some time later with a similar managed services contract with XL Capital, a financial services firm. Energizer has about 7,000 desktops in more than 40 countries; numbers for XL Capital have not been disclosed. In June 2007, the company said it had two unnamed customers ready to launch, as well as others that are considering a managed services engagement.