Microsoft Office 365 beta: first look review

Microsoft launched the public beta of its cloud-based Office productivity applications suite Office 365 on 18 April, aiming the system at “businesses of all sizes”.

Office 365 is an all-in-one package of Exchange (email), Lync (unified comms), SharePoint (collaboration) and Office 2010 applications (productivity) hosted on Microsoft datacentres in the cloud.

When fully released later this year, Office 365 will offer a variety of "plans" for different-sized firms allowing a gradation in the type of Office applications and services they can have.

The two entry-level K plans will target kiosk workers, and the single P plan will be aimed at smaller businesses and IT professional groupings. The four E plans will be enterprise-focused, although the education sector will also get a separate Office 365 offering.

Office 365 will be deployed in Microsoft's datacentres worldwide, and for UK users this means the primary datacentre is based in Dublin, with a backup datacentre in Amsterdam.

We signed up to use the beta of Microsoft Office 365 for a six-month trial, which gave us 25 Plan E3 licences, and 25 Plan K2 licences.

With E plans there are four levels of service, E1 to E4, with even the lowest E1 level offering Active Directory integration, email with a 25GB inbox, a SharePoint portal, messaging, online meetings and video calls, Forefront AV protection for Exchange and SharePoint.

Our E3 plan gave all of the above, but not the E4 options to deploy "enterprise voice capabilities to replace or enhance a PBX (private branch exchange)" [see picture above].

Operating system and browser requirements
All Microsoft's business operating systems are currently supported in Office 365, as are Apple operating systems Mac OS X 10.5 (Leopard) and 10.6 (Snow Leopard).

However, Windows XP Home and XP Media Center don't support federated identity for authentication across firms' IT infrastructure or partner IT systems using single sign-on (SSO). 

Browser support to access Microsoft's online Office 365 portal is currently limited to Internet Explorer 7 or later, Mozilla Firefox 3.x, and Apple Safari 3.x.

The Microsoft Office clients supported are Office 2010 or Office 2007 SP2 running on Windows systems, and for Mac systems there will be support for Office 2008 for Mac and Microsoft Entourage 2008 Web Services Edition, and Office 2011 for Mac and Outlook 2011 for Mac.

However,  Mac versions of Office 2008/2011 cannot be downloaded and locally installed using Office 365.

Hardware use
We used our Labs Dell Optiplex 980 and GX280 systems running Windows 7 Ultimate (64-bit version) and XP Professional respectively, and a Core 2 Duo laptop running Windows 7 Ultimate (32-bit edition).

We also used a Mac Mini running OS X 10.6 to check browser access to Office Web Apps through Apple's Safari browser.

Initial sign up
The initial sign-up allows you to create your hosted domain name – 'computingmagazine' in our case – and Office 365 tags '.onmicrosoft.com' on to it, giving a full domain name of 'computingmagazine.onmicrosoft.com'.

After sign up users create an email address that forms their Microsoft Online Services ID used to sign in – @computingmagazine.onmicrosoft.com – and an associated password.

We first created a "global administrator", which allowed us to perform service administration, check billing and account information, and to set up and configure service usage for Microsoft Exchange Online, Microsoft SharePoint Online, and Microsoft Lync Online.

There are other administrator types, such as billing administrator, password administrator, and service administrator [see picture].

After sign on, Office 365 administrators are presented with the Admin Overview screen, which has four main tabs down the left-hand side of the screen: Set Up, Management, Subscriptions and Support [see picture].

Creating users
Setting up Office 365 user accounts is simple and quick. All that's required is a first and last name, and the actual email name the user wants tagged onto the domain name you're using, as before. Multiple users can also be created using an Excel spreadsheet containing a list of users and their contact details.

After this, you can opt to create an administrator type or a standard user to be used in the country the user is based.

We firstly created a global administrator, and then set up some standard user accounts. All users have to do after that is log on to their user portal and install the Office applications locally (if they're on Plan E2 or above).

After logging on as a standard Plan E3 user, the Office 365 landing web page took us through the set-up procedure.

The time required for the set-up, which includes an install of locally installed Office applications and Team Site access (that comes with an E3 plan), was just over two hours.

One problem we did note when administering our accounts was transitioning between different webpage options. Clicking on some options brought up a "stay on this page/leave this page" pop-up instead of taking us directly where we wanted to go in the webpage dialogue.

Mac user set-up
We set up three users designed to be able to access Office 365 on our Mac Mini Labs test system, two on the K2 plan, and another on the E3 plan.

However, although Outlook Web Access works well, Microsoft is not letting Mac users install Office 2008 for Mac or Office 2011 for Mac locally.

Only the Office 365 E3 and E4 plans let users install Office applications locally, and then only Windows versions, so Mac users will have to make do with using Office Web Apps used under Team Site access, or buy the Mac Office suites as an extra.

SharePoint Team Site
All E-Plan versions allow access to a dedicated SharePoint-based portal (called a Team Site) [see picture].

After administrators have invited users to access the new site, they will be able to access the Team Site. One problem we encountered was that when going to the Team Site from the Admin page, we couldn't get back to the Admin pages. Microsoft said that firms would have to code in such access themselves.

Like SharePoint portals, Team Sites are massively customisable, and site administrators can set up separate sites for specific projects. Office 365 SharePoint portals do require less administration than on-premise portals. For example, backups are done automatically and shouldn't concern Office 365 SharePoint administrators.

Users wishing to customise any SharePoint sites created on the main Team Site will need to download and install SharePoint Designer 2010 locally, which takes about five minutes. Web portal design using a SharePoint Designer web app is not yet possible.

After the install, even though you're probably already signed in, you'll have to sign in again to edit the new SharePoint site [see picture].

Office Web Apps (OWA)
Anyone who's already used an online version of Microsoft's Office Web Apps, through an online consumer Live account, will know how useful the facility is, if only for light editing and document sharing.

Full web-based application capabilities equivalent to locally installed Office applications are not available from Microsoft, which is a shame. Users will still have to install Office applications locally to get full functionality.

OWA will be available on the P plan, and the E2 to E4 enterprise version plans, and are accessible by importing or sharing documents when on the Team Site.

Currently, the only editable file types are Excel, OneNote, PowerPoint and Word, so we uploaded examples of each file to check how OWA performs editing and viewing the files.

Clicking Word documents brings up the file with the option to edit locally or in the browser using the Word Web App [see picture].

One problem users might have with editing the four Office file types above is that OWA only supports the Open XML file formats brought in with Office 2007 – .aspx (OneNote), .docx (Word), .pptx (PowerPoint) and .xlsx (Excel).

It's not a big problem, but to use OWA means converting any documents with pre-2007 Office file formats, which means you'll have to convert them to those file formats before being able to edit them on the Office 365 Team Site. You can view documents in the old file formats but not edit them.

We edited all four types of documents with OWA, with no problems, except for the save options. With OneNote and PowerPoint applications, you can't manually save documents with "save as", because the PowerPoint Web App saves documents automatically [see picture].

With Word there is a "save" option, but you can't give the file you're going to save a different name. But with the Excel Web App you can use "save" and give the file a new name for some reason. So there appears to be some inconsistencies here, which will presumably be resolved before the final Office 365 service is unveiled.

Domains, Active Directory and Exchange migration
Although we didn't look at these features, firms having an on-premise Active Directory install can synch contacts, groups and user accounts with Office 365, making a user rollout and management much easier for IT administrators.

Firms having a registered domain name can also redelegate their domain so that it can be used in Office 365. This means that firms' DNS servers (whether hosted or not) would point towards their Office 365 portals, as well as any on-premise Exchange, Lync or SharePoint sites.

Office 365 Exchange and Lync
All E plan deployments have Exchange, Lync and SharePoint hosted in Microsoft's datacentres through the onmicrosoft.com domain, and all three are managed from firms' Office 365 admin webpage.

On-premise Exchange managers will recognise most functionality on the Exchange admin page, allowing "users and groups", "roles and auditing", and unified messaging for how mobile devices synchronise with Exchange.

Similarly they will recognise the Lync control panel for setting up domain federation between on-premise Lync deployments and Office 365 deployed users.

Options exist for blocking all domains outside the corporate firewall except those that admins allow, or allowing federation with all domains except those specifically blocked.

However, since we didn't re-delegate any domains, we couldn't set up a proper Exchange/Lync scenario.

Mobile device integration

Another feature we didn't have time to look at was how mobile devices integrate into Office 365. Microsoft says, "A variety of mobile devices can be connected – typically mobile phones that can synchronise information with Windows – to Microsoft Office 365 for enterprises."

Devices will be able to send and receive Office 365 email, "and – typically – access calendar and contacts information". Currently, device support exists for Windows Phone, Apple iPhone, and BlackBerry devices, although BlackBerry device users "will only be able to send and receive email".

Support and Service Health
Office 365 administrator accounts do offer the following support options: a ticketed service request feature for troubleshooting problems with Office 365, and a Service Health and Planned Maintenance dashboard allowing admins to check on any current problems with Office 365 globally and also future planned outages for the service [see picture].

We'd like such planned maintenance flagged up to administrators via an email alert rather than having to check whether there could be an interruption to service use, although Microsoft says that users can configure RSS feeds to alert them to Office 365 service problems.

The Service Health page also gives far too little detail on service problems. For example, while we were reviewing Office 365, the Service Health page showed problems with the Lync Online service. The outage appears to have lasted over three hours (the "service restored" Status on 03 May should read "Investigating" [see picture].

The 'financial guarantee'

We spoke to Microsoft Office 365 product manager Gill Le Fevre about the 'financial guarantee' Microsoft is backing Office 365 availability with.

"There'll be three levels of subscription re-imbursement corresponding to three levels of availability - 99.9 per cent, 99 per cent and 95 per cent," said Le Fevre.

"If the Office 365 service you're using drops below 99.9 per cent Microsoft will re-imburse 25 per cent of the monthly fees. Dropping below 99 per cent will result in a 50 per cent fee re-imbursement for that month, while if 95 per cent availability is breached, Le Fevre said, "We'll credit back immediately 100 per cent - all of their subscription fees."

So for a 30-day month, downtime shouldn't be more than 43.2 minutes or 99.9 per cent ('three nines') availability will be breached. A 99 per cent ('two nines') availability breach means the service will be unavailable for 7.2 hours, while for a 95 per cent availability the downtime shouldn't go over 36 hours.

Pricing

Office 365 for professionals and small businesses, Plan P gives Office Web Apps, Microsoft Exchange Online, Microsoft SharePoint Online, Microsoft Lync Online and an external web site for £4 per user per month.

Office 365 for enterprises, Plans E1 to E4, starts at £1.30 per user per month for basic email (Plan E1). Plan E4 costs £15.75 per user per month, and gives firms Office Professional Plus, along with email, voicemail, enterprise social networking, instant messaging, web portals, extranets, videoconferencing, web-conferencing, 24/7 phone support, and on-premise licences.

Conclusions
As expected there were glitches in the Office 365 beta, some operational, like those with Lync 2010 Online discussed above, and some due to ill-designed transitioning between web pages.

It was easy to set up users, access and use the SharePoint portal team site, and upload and share documents using Office Web Apps.

A big question is how many firms are using Office 2003 and see any need to upgrade to a cloud-based version?

For Office 2003 users, this would mean moving (and paying for) Office 2010, and upgrading hardware to 64-bit systems if they wanted to synchronise an on-premise Exchange system with Office 365's cloud-based system.

Another thing firms ought to do before thinking about any moves to cloud-based Office applications is to actually review Office application usage before plunging into any upgrade, to make sure they aren't using more copies than they need.

Unfortunately Microsoft's Office 365 system does not offer any in-between versions of Office 2010, such as a Standard version or a Home & Business version. It's Office 2010 Professional Plus or nothing. This could mean users paying for functionality that they'll never use.

The major problem for firms would be to how to calculate the financial costs of moving to Office 365 from their current Office infrastructure. If they find it is more expensive, would they still move to Office 365 and have to rely on the increased productivity from their workers to justify the deployment?