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Exploring 3 Alternatives to an Enterprise M365 Subscription
In her Enterprise Connect keynote, Nicole Herskowitz, VP of Microsoft Teams, shared several statistics revealing how successful Microsoft Teams has become in just over five years. She cited a recent Morgan Stanley CIO survey that concluded over half of organizations (54%) have standardized on Teams, and that number is forecasted to increase to 75% in the next three years. She also referenced that Teams was being used by more than 90% of the Fortune 500.
These are huge and impressive statistics. Microsoft Teams is a phenomenal success. If Teams truly reaches 75% of organizations (presumably U.S. businesses) within its first eight years, we are talking dominance unlike anything we have seen since the Bell System. Microsoft deserves credit for taking bold steps with Teams before the market was ready. Skype for Business was still growing, and a cloud-native, messaging-centric solution like Teams was simply ahead of the market.
In terms of scope, Teams implementations can vary. The application can be used for messaging, meetings, and calling, but not all customers use all three components. The base version supports calling between clients, but PSTN services require additional licensing. Telephony services can be enabled through Microsoft or via a Direct Routing partnership.
Getting Back to Competitive Evaluations
My concern with Teams is that it appears many organizations obtain rights to it via a Microsoft 365 subscription rather than do a competitive evaluation. As an IT leader in the prior millennium, I am familiar with this bundling playbook. The original MS Office bundle was Word and Excel, and I used it to get rid of WordPerfect. When PowerPoint joined the bundle, we got rid of Harvard Graphics. When NT came out, we got rid of Novell. Then, Exchange replaced cc:Mail and IE replaced Netscape. I remember installing Live Communications Server (LCS), not because we needed or wanted it, but because we had it. Prior to its acquisition by Salesforce, Slack was feeling the pressure and filed an antitrust complaint against Microsoft.
My conclusion is that Teams is often pushed to — not pulled by — enterprise users. I agree that Teams is a great messaging platform but so are several others. The competitive alternatives are excellent, and many offer a very similar set of features. Cisco Webex, RingCentral Glip, Zoom Chat, and many others can be used to support enterprise-wide messaging/workstream collaboration, meetings, and/or telephony. If the competitive differences are not that significant, how does one product gain 75% penetration?
The Microsoft 365 bundle is mostly tied to email and the Office Suite. As these applications work well across operating systems, the market dominance of Windows is less significant. SaaS offerings such as Salesforce, Oracle, and ServiceNow put less reliance on back-office server apps as well. All Microsoft 365 subscriptions include Teams, and Microsoft has made its subscriptions the most effective way for enterprises to obtain Office. This can create a nagging feeling of double-paying when it comes to comms apps.
So, the question that comes to mind is if a Microsoft 365 subscription is good for enterprises? Let’s look at three paths: First, alternatives to Office and Email, then alternative ways to obtain Microsoft Office, and thirdly, the status quo with Microsoft 365.
Numerous viable alternatives for Office and email are available, as well as ancillary services such as shared drive, directory services, and more. If an organization can skip enterprise-wide Microsoft 365 subscriptions, we will likely see a more competitive vendor landscape in enterprise communications. Here are two alternatives to consider:
1. Google Workspace
Google Workspace is probably the most mainstream alternative to Microsoft 365. Like Microsoft, enterprises can choose from multiple subscription levels. Google Workplace subscriptions run $6-18 per user/per month, plus an Enterprise plan that requires a custom quote. All plans include email, office productivity apps, video conferencing, and cloud storage.
Recently, Google relaunched G Suite as Google Workspace. The changes have included new apps for messaging and conferencing (Google Chat and Meet) and a refreshed UI on Gmail. All Workspace apps are cloud-native and browser-based, yet many of them can be used offline. Google offers an end-to-end experience with both Chrome (app and OS) across Windows, MacOS, and Linux machines.
The Workspace apps are relatively basic compared to Microsoft Office. Some users may still require individual Office licenses, especially spreadsheet power users. The same can be said for the enterprise communications applications such as Google Voice. A core offer is there for a single-vendor solution, but there’s opportunities for a competitive landscape.
When I first encountered Zoho, it seemed very similar to G Suite with a set of integrated, browser-based applications. The company now offers over 50 applications that can be obtained individually, in bundles, or as a complete package called Zoho One. Its core solution set is centered around Zoho CRM. Zoho claims over 75 million customers.
Zoho is very attractive for smaller organizations as its integrated, browser-based suite simplifies matters for IT. However, Zoho also claims that 90% of the Fortune 500 companies use some of their apps. Zoho Workplace starts at just $3/mo/user and includes Mail, WorkDrive, the Zoho Office Suite, Meet (meetings), and Cliq (messaging). Zoho doesn’t attempt to serve all customers. Zoho Meet, for example, is ready for casual meetings, and it leaves webinars and meeting rooms for other providers.
Zoho works to be a sustainable company. It has avoided debt and acquisitions. It built, rather than acquired, its suite and hosts them in its data centers. It employs about 10,000 worldwide. The company recently moved its US headquarters from Silicon Valley to an agricultural site near Austin, where it encourages employees to grow organic food for their own use.
Many other options are available as well. Honorable mentions to the Apple Office Suite/iWork, Apache Open Office, FreeOffice, LibreOffice, and specialized cloud providers such as Box and Dropbox. However, it’s hard to beat Microsoft Office in terms of features and polish.
Since Microsoft still sells Office licenses, another approach for enterprises to consider is a virtual desktop.
Amazon WorkSpaces: Another Way to Obtain Microsoft Office
Amazon WorkSpaces is a virtual desktop infrastructure service from AWS End User Computing. Virtual Desktop Infrastructure (VDI) offers a Windows (or Linux) desktop as a service. WorkSpaces is a fully managed virtualized desktop service that can be accessed from a PC, Mac, Chromebook, or mobile device.
Customers select a WorkSpaces bundle that includes operating system and performance specifications. The desktop is accessed, like an application, from a browser or WorkSpaces client. Yes, you have to pay the VDI provider for hosting it, but you can save money with lower-spec hardware and reduced support costs. The persistent desktop starts up exactly where a user left off — even if they changed devices.
The software on the virtual desktop can include any software that an organization may already own. So, Microsoft Office licenses could be re-used or obtained directly from AWS in the Workspaces subscription. Note, MS Office does not include Teams as it is not a standalone software product. Workspaces subscriptions are available under hourly and monthly models.
Workspaces can be combined with other AWS services such as WorkDocs, Amazon’s version of Office and SharePoint. Also, WorkMail for email and calendar. Of course, these services can also be obtained from other providers as well. Additional alternatives for VDI include VMware Hizon Cloud, Citrix Virtual Apps and Desktops, Evolve IP, and V2 VCloud. Microsoft also offers Azure Virtual Desktop.
Assessing Your Enterprise Options
If Microsoft Office and Exchange/Outlook are non-negotiable, then Microsoft 365 may make the most sense. Other benefits of the suite include more applications and less training in most cases. However, it’s also important to consider the value of innovation, which often results from competitive pressures. The UCaaS vendor landscape is getting smaller.
Another way to embrace competition is to reexamine the bundle. Several providers are now bundling CCaaS services with UCaaS. Amazon and Google offer bundles associated with cloud infrastructure and AI technologies. Cisco has an extensive lineup of room and desktop devices and can also bundle networking solutions. Salesforce now bundles CRM with Slack.
Microsoft’s products are excellent, and I use them when appropriate. However, purchasing applications individually per user evaluations and requirements has its merits. Alternative options disappear in non-competitive marketplaces.
Dave Michels is a contributing editor and analyst at TalkingPointz.