Microsoft Luring Small Businesses to Servers

Hoping to induce more small businesses to use servers and related server applications, Microsoft has dropped the price of its Small Business Server suite and improved its functionality. Small Business Server (SBS) 2003 comes in a new US$599 “Standard” Edition that includes only Windows Server, Exchange Server, and Windows SharePoint Services, which could open the product up to even smaller businesses than previous versions. However, under the covers, SBS 2003 is still a complex product, which means most customers will need the support of a service provider.

High Growth Potential in the Small Business Market

According to IDC, only 19% of U.S. “small” businesses (defined as having fewer than 100 employees) have one or more servers. However, another 11% have PCs on a peer-to-peer network without a server and 36% have two or more non-networked PCs. Because the number of small businesses is huge—these latter two segments represent 0.84 million and 2.73 million small businesses, respectively, in the United States alone—they are a tempting target for a low-cost, easy-to-use server. In addition to hoping to sell these businesses SBS, Microsoft sees substantial long-term opportunities to sell Microsoft Business Solutions products, such as accounting and CRM products aimed at small businesses, which all require a server.