Who killed Windows Small Business Server? Google

Most people probably didn't turn a glance at Microsoft's other big recent release, Windows Server 2012. Server operating systems rarely get much attention, and appropriately so; their appeal and importance really only extends to the rank and file of server administrators and other similar decision makers. And plus, with Windows 8 and Surface making the public rounds, there's plenty of fanfare to go around.

But there's something most obviously missing from the latest Server 2012 lineup, and that is a subsequent Small Business Server release.  Redmond Channel Partner magazine first brought this to my attention. Not only did SBS get the axe, but Microsoft also went on to kill off Windows Home Server as well. The last public version of WHS was version 2011, which happened to be the second and final release in this platform's short lived history.

What gives? Microsoft spent the better part of the last decade convincing partners and small businesses that its small-and-medium-business-focused server offerings were just what the doctor ordered. A centralized file server for local sharing; Exchange powering email and contact needs; and Active Directory for authenticated data controls. Come 2012, however, and everything was for naught. It doesn't take a genius to figure out that a certain Google is the executioner here.

Google started the Small Business Shift to the Cloud

Small Business Server had quite a run by any estimates. While Microsoft pushed out a few half-baked editions of essentially the same line before 2000, the one that solidified SBS as a player in small business was definitely SBS 2000. The market picked up its successors 2003 and 2008 quite heavily, with the last version being 2011.

Looking back, the introduction of Google Apps Premier Edition in 2007 began the countdown to SBS' end, I believe. The evidence is pretty well documented, but here's a good breakdown of the sequence of events leading into 2012:

  • 2007: Google Apps Premier Edition is released, with the search giant telling companies large and small that the cloud is finally ready for primetime. Adoption steadily grows, especially in the SMB sector.
  • 2009: Microsoft launches Business Productivity Online Suite as an answer to Google Apps' growing popularity.
  • June 2009: Google releases Google Apps Sync for Outlook, which allows Outlook holdouts to leverage the cloud as their backend and Microsoft's email client as their frontend.
  • March 2010: Steve Ballmer gives a big speech at the University of Washington on Microsoft's new-found cloud commitment. "About 75 percent of our folks are doing entirely cloud based or entirely cloud inspired...a year from now that will be 90 percent".
  • June 2011: Microsoft releases Office 365 to phase out the half-hearted cloud email solution, Business Productivity Online Suite.
  • Oct 2011:  Google quietly says that 4 million businesses are on Google Apps already. This includes a majority of small businesses that my own computer repair company supports.
  • Sep 2012: Windows Server 2012 is released, with SBS and Home Server getting the axe. Privately, Microsoft is gesturing for small businesses to begin their move to the cloud. Preferably Microsoft's, of course.

A look back on the last six years clearly shows that Microsoft is touting a new line, and not necessarily at its own behest. Google took the risk of treading heavily into the cloud and proved that business could host its beloved email, contacts, and calendar data in the cloud safely while saving money.

While Microsoft won't say it publicly, the mere fact that they laid waste to Small Business Server shows that Microsoft's not willing to compete with Google at an uneven footing. That is, telling small business that it's better off keeping on-premise servers for email and data in contrast to adopting a cloud solution. That argument has already lost out - hence the push for getting Office 365 to stem Microsoft's small business customer bleed to Google Apps.

Office 365 is the New Shining Knight in Microsoft's SMB Lineup

It's actually great to see Microsoft pushing Office 365 for businesses because it's a promising product. While I don't think it topples Google Apps in terms of features and the best all-around package, Office 365 is only going to get better. And better yet, Microsoft is seriously behind its cloud baby this time around (compared to its missteps with BPOS.) So much so that the company is officially telling partners that support small businesses to "learn up" on Office 365 or lose competency certification in small business support.

Most outsiders would never blink an eye at the changes, but Microsoft partners who are either looking to get or uphold their Small Business Competency are fully aware of the changes to the program requirements. Most notably is the formal requirement of passing a test on Administering Office 365 for Small Businesses. Yes, partners, Microsoft does want you to get Office 365 adoption going, and it starts at the small business level.

This begs the question then: does Microsoft see a place for its on-premise server products in the small business realm? The answer is increasingly looking like a No.

Is Server 2012 Essentials a Real Successor to SBS 2011?

Publicly, Microsoft says that Server 2012 Essentials is the ad-hoc successor to SBS 2011. But if you dig down and compare the feature sets of each, you can clearly see that Microsoft considers Essentials more of an afterthought than a true upgrade path. Here's why:

  • User limits. SBS 2011 Standard had a 75 user limit, while 2012 Essentials brings this down to a mediocre 25. Intentional? I think so.
  • Exchange for email. Simply put, 2012 Essentials stripped out Exchange entirely. SBS 2011 had Exchange integrated, allowing small businesses to bypass licensing Server and Exchange separately at a greatly increased up-front cost.
  • Sharepoint for collaboration. Another feature that bit the dust in Essentials 2012. SBS 2011 Standard still integrated this nice functionality.
  • Windows Server Update Services. Nixed like the rest in Essentials 2012; SBS 2011 Standard still bundled this item for on-premise Windows Update distribution to office computers.

So is Server 2012 Essentials looking like a direct upgrade path for Small Business Server users, or has it been purposely hobbled to give way to the cloud? You can make up your own mind, but I think Microsoft is pretty blunt about their decisions made with the Server 2012 Essentials product. "Take it or leave it" seems to be the approach. It's an interesting attitude to take, and one that is likely spurring many customers, like the ones my company works with, to begin their move to the Google Apps or Office 365 cloud.

Coming back full circle on my main point here, I don't think it was an easy decision within Microsoft to let go of the small business market for on-premise server solutions. While the company publicly supports Essentials 2012 as the prime successor to SBS, we can all see from the comparison above that this is anything but the case. Microsoft knows that the cloud is taking hold in the small business realm, and that if it has any chance in holding back Google Apps adoption, Office 365 needs to get a strong foothold. This is where Microsoft clearly positions its SMB channel partners to act as its front line warriors.

So while Microsoft clearly conceded to the cloud in the SMB arena by killing SBS, it is Google's credit to take. Google Apps is here to stay Microsoft knows, and there's no better way to fight fire then with Office 365, I guess.

Photo Credit: Fer Gregory/Shutterstock

Derrick Wlodarz is an IT professional who owns Park Ridge, IL (USA) based computer repair company FireLogic. He has over 7+ years of experience in the private and public technology sectors, holds numerous credentials from CompTIA and Microsoft, and is one of a handful of Google Apps Certified Trainers & Deployment Specialists in the States. He is an active member of CompTIA's Subject Matter Expert Technical Advisory Council that shapes the future of CompTIA examinations across the globe. You can reach out to him at info@firelogic.net.

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