Microsoft is producing so much effort in the SaaS space recently that they can get one easily confused. Quickly: can you tell the difference between Microsoft Exchange Online, Exchange Labs, Windows Live Hotmail, Microsoft Live@edu, and Exchange Hosted Services?

Fear not. This post will make the distinction crystal clear!

First of all: All of them except Exchange Hosted Services are hosted messaging solutions from Microsoft. Exchange Hosted Services are Microsoft’s anti-virus, anti-spam, archiving solution in the cloud having nothing to do with Exchange. They acquired the services from Frontbridge back in 2005.

By the way, the archiving services are not yet fully integrated with Exchange Online and others (although manual procedures to set the integration up exist), are limited to 10,000 mailboxes per organization, and have performance issues. All of that is to be resolved next year with both software updates and new datacenters getting rolled out.

Now to the actual messaging services…

Windows Live Hotmail (previously known as Hotmail, then MSN Hotmail, then Windows Live Mail, and recently re-branded to the current compromise name) is the only one of them which is not based on Microsoft’s Exchange Server technology. Instead it derives from the webmail system Microsoft acquired back in 1997.

The other difference is that unlike the other three solutions this one is entirely consumer-oriented.

According to Eric Ashby (Microsoft’s program manager in charge of Exchange Online, with whom I talked at TechEd EMEA last week), there are no current plans to move Hotmail to Exchange technology, so both these differences are there to remain for the time being.

Microsoft Live@edu - is Microsoft’s free set of tools and services for educational institutions. Messaging is the key service in the bundle and it comes in 2 options: Hotmail (at which we already looked above) or Exchange Labs (to be discussed below.)

Exchange Online and Exchange Labs are very similar. Both represent hosted Microsoft Exchange Server-based solutions for businesses. The key difference is that Exchange Online is based on the already RTMed Exchange 2007, and Exchange Labs - on the next version (code name “E14″) currently in development.

Here’s a very high level comparison between the two:

Other interesting tidbits of information which Eric shared:

• Currently the Exchange Online service is limited to 25,000 mailboxes per customer.
• He kept using companies migrating from Notes/Domino as deployment examples. Could be related to personal bias or Microsoft’s push for competitive upgrades. He kept recommending Quest Notes migration tools for the task (full disclosure: I work for Quest although not for that team.)
• At Microsoft 500 employees are using Exchange Online. The rest are on regular on-premise Exchange.
• There are a few limitations during the co-existence period when some users are still using on-premise Exchange. The biggest one is unavailability of free/busy information. There are also issues with voice-mail and other services relying on mailbox data. Eric mentioned that there was a yet not-to-be-disclosed vendor working on a mailbox synchronization solution to solve the problem.
• Currently they often recommend dedicated Exchange Online environment for bigger organizations as the only way to have full administrative control of their system. In the Exchange 14 timeframe most of these advantages will go away, so technically everyone will be able to share environment with other customers. Some might still pay extra to feel special and know that they get dedicated service.

I hope this all is making sense now:

• Exchange Hosted Services - is an anti-spam, anti-virus, archiving solution,
• Windows Live Hotmail - is webmail for consumers,
• Microsoft Live@edu - is a bundle for educational institution which may use Hotmail or Exchange Labs as the messaging engine,
• Exchange Online - is hosted Exchange 2007.
• Exchange Labs - is hosted beta of the next version of Exchange (E14) and using all the great federation technologies pitched by Microsoft on the recent PDC event.

Technorati Tags: Exchange Hosted Services, Exchange Online, Hotmail, Labs, Live@edu, Microsoft, SaaS, Windows Live
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