It's 'curtains' for start-ups as Microsoft 'plugs the gaps' in Office 365

Tony Pepper, CEO and co-founder of Egress says that if Microsoft keeps plugging gaps in its Office 365 support offering, it could be 'curtains for a bunch of start-ups'

Many startups are threatened by Microsoft's success at plugging the gaps in the tools and software needed to support its Office 365 offering.

That's the opinion of Tony Pepper, CEO and co-founder of secure cloud-sharing platform Egress. Pepper told Computing that Microsoft is already doing a great job of "plugging the gaps" in its offering.

"You have to be careful otherwise Microsoft could develop three or four strains of what they've already got, and it doesn't need to be a huge amount more and suddenly it's going to be curtains for a bunch of start-ups," said Pepper. "Microsoft have really stepped up their game over past five years," he added.

He explained that start-ups usually focus on one niche area, and try to do it well. This could include adding in a tool or function that Office 365 users might need.

"But Microsoft has really put flashlight on that now," Pepper argued "They're doing lots of things, and traditionally you'd follow that up with: yes, but they're doing them badly. But that's not the case any more. They're doing lots of things and they're doing them very well.

"It's all about supporting applications. They're playing in the datacentre business, so the likes of UKFast, SkyScape, and other independents are thinking ‘how do we compete with Microsoft at a hosting level?' There's a threat there. If you look at the applications they host within that, Office 365 has completely changed everyone's world.

"And not just in the hosting of mail, but in the supporting services within that," he continued. "They have a really interesting rights management play now, they're using things like OneDrive for storage so storage players are getting beaten down. And their encryption isn't bad, it's not great but it's getting better. They've made a bunch of acquisitions now and tied them all together and Office 365 is a compelling world now.

"As an independent you've got to ask: how do we align ourselves with those looking at Office 365 and work with it but also offer something that differentiates us? If technology businesses aren't looking at Microsoft and the Office 365 platform as the biggest threat, they're kidding themselves. It's taken up all of our time that's for sure," he added.

He gave the example of the data classification arena, a technology area set to increase in importance to enterprises as the impending GDPR will require firms to know precisely where they store all personally identifiable information.

"There are two players: Boldon James and TITUS," said Pepper. "They're the two that have existed for fifteen years. Microsoft bought Secure Islands [in November 2015, which was then integrated into the Azure Rights Management Service] and they've embedded classification into their Office 365 play. Their classification is really solid now. As independents, Titus and Boldon James need to think really carefully about what they do. They might be the best, but good enough from Microsoft might squeeze them out of the market. And that's just one out of a hundred examples of where Microsoft and their competitive threat is a concern for lots of security players.

"That's why we're having to look not just at encryption but also at how our products add value to customers using Office 365. If you're not using Office 365 it doesn't matter, but if you are, what does the customer journey look like using our software alongside Office 365?"

Some Microsoft services, including Outlook and OneDrive, have been experiencing regular outages this year, with the most recent in mid-August.