A deal for BT to provide a platform for the delivery of
Mircosoft's business applications is the software supplier's next
step in moves to sell software as a service.
The companies are targeting the small and
medium-sized enterprise market with "a la carte" applications as
well as software bundled with broadband services.
Microsoft already works with other telecom providers in the US
and Europe.
BT selected Microsoft over its incumbent middleware provider,
BEA Systems, to build an application delivery platform and provide
business software specifically targeted at the large and
potentially lucrative SME market.
The agreement, valued at $7m (£3.65m), builds on BT's strategy
of building out broadband services amid falling fixed-line
revenues.
"This is a great opportunity to exploit the market for both
software services and broadband," said Brendan O'Rourke, BT's
general manager of retail internet networks.
He said that BT selected Microsoft over BEA because it could
easily integrate Microsoft products into its existing
infrastructure, and for the applications' sophistication. BT plans
to introduce its first service, Microsoft's Hosted Exchange, in
July.
Daren Mancini, Microsoft's UK communications sector director,
said that Microsoft hopes to provide affordable and easy to use
applications and then evolve the offerings to more sophisticated
software that businesses can share with their partners and
customers.
For BT, the software services are also clearly a way to roll out
bundled broadband and Wi-Fi offerings. While 69% of SMEs in the UK
have internet access, only 37% have broadband.
BT will offer Microsoft's e-mail, calendar and collaboration
applications on a subscription basis.
BT's new hosted application services are also being developed
with the help of systems integration provider Tata Consulting
Services and Hewlett-Packard, which is providing services to
deliver Microsoft's Hosted Exchange infrastructure within BT.
Scarlet Pruitt writes for IDG News Service