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Microsoft Online Services is Microsoft's hosted-software offering and a component of their software plus services strategy. Microsoft Online Services are hosted by Microsoft and sold "with" Microsoft partners.
For businesses, the Software-plus-Services approach enables organizations to access the capabilities of enterprise software through on-premises servers, as online services, or a combination of both, depending on specific business requirements. Services also provide the option to add complementary capabilities that enhance on-premises server software and simplify system management and maintenance.
Product Suite: Business Productivity Online Suite (BPOS)
The Business Productivity Online Suite Standard represents the first of a growing portfolio of Microsoft Online Services. Microsoft Online Services are a component of the broader Microsoft Software-plus-Services strategy that includes both Live and Online services.
The successor of BPOS is Office 365. Where BPOS is based on Exchange 2007 and MOSS 2007, Office 365 was originally built around the 2010 versions of Exchange and Microsoft Office SharePoint Server (MOSS) and now the 2019 versions, since one of the benefits of Office 365 is that it is 'evergreen'. For Instant Messaging, plus audio & video conferencing, Office 365 provides Skype for Business (formerly Microsoft Lync).
Apart from these communications and collaboration applications, Office 365 will also have Microsoft Office Professional Plus included, which is the regular Office pack. On top of that online versions of Word, Excel and PowerPoint are provided 
Microsoft opened the Beta phase for this service in Q4 of 2010 and the service went live June 28, 2011
Selected Office 365 features:
Collaboration: Since Office 365 is cloud based, multiple people can edit the same document at once (in Word, PowerPoint or Excel) and you can even see edits as they are being made- as well as see who is making the edits. Chat With Users Through Skype: Microsoft has already begun rolling this feature out to users and it lets you easily chat with document collaborators through Skype. The best part? Even if you leave the document, you can continue the conversation through Skype on your mobile device or computer.
Microsoft has set up a dedicated support department for BPOS outside their standard Professional Support Services. One reason can be that the type of support requests will differ from service requests for Microsoft products the customer runs on his own infrastructure: when a company opens a support question because they have problems with mail-sending using Outlook and their own Microsoft Exchange Server the technical side of such a support request is totally different from when the customer uses BPOS. Also the expectations of the customer will be different: they have outsourced the services to Microsoft to avoid problems, thus when it doesn't work they expect that Microsoft solves their problem quickly. For that reason a dedicated BPOS and Office 365 support desk is in place in the US and in Ireland for the EMEA region. Microsoft's main support-providing partner HP has been busy finding and training new Tier 1 and Tier 2 support engineers for this desk. The EMEA support desk currently handles 1st line and escalated BPOS cases and is expected to support Office 365 cases after the product went live in June 2011.
Cloud computing and BPOS
On March 4, 2010, Steve Ballmer gave a speech focused on Microsoft's cloud computing commitment at the University of Washington. Here is an excerpt from the Seattle Times, "The cloud fuels Microsoft and vice versa. 'About 75 percent of our folks are doing entirely cloud based or entirely cloud inspired,' Ballmer said. 'A year from now that will be 90 percent.' This full embrace of the term cloud computing is new for Microsoft. Up until now Microsoft was still pushing the term 'software as a service' to describe cloud software."
- Microsoft's cloud forms
- Microsoft Online Services FAQ
- "Microsoft Office International Availability".
- Office 365 website on Cloud based productivity tools, visited 2 April.2011
- Office 365 website on Office Professional Plus, visited 3 April 2011
- MSPMentor website on Microsoft Targeting July 1 for Office 365 Cloud Launch?, visited 3 April 2011
- HP Job site for BPOS engineers, visited 2 October 2010.
- "UW CSE News » Microsoft's Steve Ballmer at UW, Thursday March 4".
- "Microsoft Pri0 - Steve Ballmer speech at UW: "We're all in" for cloud computing - Seattle Times Newspaper".