Microsoft Rails Against Fasthosts' Office SaaS

I figured we would see a few of these. As SaaS takes off, major software vendors who were slow in the SaaS uptake may find that others do it for them, whether or not they have agreements. Microsoft is first to toss a punch at their partner Fasthosts, whose new product, Office SaaS, is a bit too similar to Office Client, according to Microsoft.

From this article:

"Microsoft has said that the Internet service provider Fasthosts, which has started offering a subscription-based version of Microsoft Office 2007, is infringing on the software giant's license regulations - but Fasthosts has denied this claim."The issue is more around how it's delivered:

"Fasthosts' Microsoft Office product uses the SaaS model in that it is delivered and managed via the Internet,' explained Mark Jeffries, Fasthosts' chief technology officer, on Thursday. Speaking with ZDNet.com.au's sister site ZDNet.co.uk via e-mail, Jeffries said that 'a full version Microsoft Office, identical to the boxed product, is downloaded using a streaming service and saved locally on a user's PC.' 'After one initial download, further small downloads are made for additional features and updates. When functions are used for the first time, features are seamlessly streamed in the background. The software is validated when connected to the Internet,' explained Jeffries."

Fasthosts claims that this version of Office was the result of a partnership "with Microsoft and established market-leading experts in the field of software streaming." However, Microsoft is contesting this.

"Fasthosts is a valued Microsoft partner who we have a great relationship with," said Michala Wardell, head of anti-piracy at Microsoft UK, last week. "At present, streaming Microsoft products like Office 2007 via the Web infringes our license regulations. Fasthosts have been informed of this and we are currently working with them to rectify this situation."

Microsoft has been clear about its intensions to begin offering some of its products as SaaS. However, it has not officially launched any business products along those lines. Microsoft is looking to deliver the software differently, running from a provider's servers and being accessed through a browser, rather than being installed on the user's machine.

Clearly, Fasthosts did the download thing, and this is what got Microsoft all worked up. In essence, each customer gets the software installed, albeit incrementally, versus leveraging the software through the browser as a rich internet application (RIA).

I figured this would happen. The fact is that the line between native software, such as Office, and software delivered through the advanced features of the browsers today, such as Ajax, is becoming blurry. Thus, it does not surprise me that somebody went ahead and made the next logical leap, downloading software on demand. Indeed, there are many SaaS players who download software to the native operating system to support, well, native features. Security comes to mind, but there are other examples.

This issue with Fasthosts is not how they are providing the software, but what they are providing - Microsoft Office. It will be interesting to see if Microsoft does allow them to deliver Office using a browser-based container, such as Ajax or ActiveX. Then the question is: What's the difference?I figured we would see a few of these. As SaaS takes off, major software vendors who were slow in the SaaS uptake may find that others do it for them, whether or not they have agreements. Microsoft is first to toss a punch at their partner Fasthosts, whose new product, Office SaaS, is a bit too similar to Office Client, according to Microsoft.