The Hosted Apps Dilemma

This recent piece in ComputerWorld highlights the growing interest in hosted Microsoft Exchange. No surprise; but why now? And if you use Hotmail or Gmail, you may even ask why hosted Exchange is worthwhile at all. If so, consider this:

First, hosted Exchange offers full-featured contacts, calendaring, and e-mail in tight integration, just like the Outlook on your desk. Meanwhile, it spares users the typical pain in the ass features of a self-hosted Microsoft product: compatibility issues, upgrades, backup problems, disaster-recovery, smartphone support, spam filtering, patching, etc. In effect, with hosted Exchange you get your own “virtual e-mail server” in a secure, faraway datacenter, but only pay for what you use, usually on a monthly basis. Microsoft has been using this deployment model for some time in the educational market and it has worked.

Second, whereas Microsoft takes a top down approach to security, Google generally works from the bottom up. For instance, Google generally starts with consumer-facing products and scale them upwards until they can work in an enterprise environment. Thus Gmail, Google Calendar, GTalk, and a host of Google consumer toys has been integrated and reborn as Google Apps. Microsoft on the other hand usually starts with enterprise products, makes an obscene amount of money via licensing, and scales down to smaller business and consumers. This was the genesis of Outlook.

Third, consider that the gap between Google Apps and Microsoft Office is getting narrower all the time. And with its Office 365 product Microsoft is blurring the line between it and Google even further. Office 365 retains the look and feel of MS Office, while saving the organization tons of money and virtually eliminating the need for beefed-up IT departments (sorry IT guys).

As with all technology, lawyers are the last to know. Once the cat is out of the bag though, news spreads fast. Your opponents are going to take every advantage they can, so you should too. Ultimately hosted applications such as Exchange and web-based applications like Office 365 and Google Apps are the future. And why not: law firms are about serving clients, not endlessly fiddling with their IT infrastructure.