Two questions keep coming up in SharePoint conversations with clients – What’s the licensing for Office Web Apps? Can I create documents using just Office Web Apps with SharePoint or do I still need Office to be installed?

The short answers are: licensing is complicated; yes you can create documents using Office Web Apps within SharePoint and no you don’t need Office to be installed (in fact, you can only create new documents using Office Web Apps when you don’t have Office installed).

Here are the details and we’ll see if Microsoft disagrees…

Office Web Apps comes in two versions: consumer and business.

The consumer version of Office Web Apps is available for free online because it is supported by embedded advertising, similar to using Google’s various free online apps such as Google Docs. You can create, view and edit documents without needing Office installed, you just need a browser. To use it, you will need a Windows Live account just as you need a Google account to use Google Docs. The documents are stored online using Windows Live Skydrive (formerly known as Office Live Workspace).

The business version of Office Web Apps is not free. In order to use it, each user must be licensed to use the full version of Office 2010. And it has to be a volume license, i.e. your organisation has a bulk volume license (or Enterprise Agreement – EA) to install Office. Office Web Apps are not included with retail or OEM versions of Office or with any previous version of Office. And every user who accesses documents using Office Web Apps must have a volume licenses to use Office, including third parties outside your organisation. As far as I can tell, this renders Office Web Apps an expensive option for extranets and public web sites given there are free and cheaper alternatives are available. It will also exclude small businesses who purchase Office either with new PCs (OEM) or full package (retail). And it will exclude organisations who have on-site customers who may want to access documents using a web browser. Schools and colleges, for example… if the normal policy is to expect non-employees to purchase their own computers and software to access documents held on your systems, you will need to buy licences to give them access via Office Web Apps. And don’t forget you’ll need SharePoint licences too if you are running SharePoint Server 2010 instead of SharePoint Foundation Services (the latter is included with Windows licensing)…

So, that’s the licensing side. If you’ve cleared that hurdle, on to using Office Web Apps within your organisation…

To use the business version of Office Web Apps, they are installed as an add-on to SharePoint 2010 <-yes, that means you need to deploy SharePoint 2010 to use Office Web Apps. You can access Office Web Apps within SharePoint from any browser-enabled device, you do not need to have Office installed. When Office Web Apps are configured, SharePoint will automatically open Office files in the browser by default. There is an icon to click if you want to edit a document. However there is no ‘New’ icon. Who knows why? The only way to create new documents using Office Web Apps on SharePoint 2010 is to click the ‘New Document’ icon from within a document library. If Office is installed, this action will launch the full client. If Office is not installed, this action will open a new document in Office Web Apps.

The official supported browsers for Office Web Apps include: Internet Explorer 7 and 8, Safari 4 on OS X, Firefox 3.5 on Windows, OS X or Linux. Other browsers may or may not work, e.g. mobile versions, they’re just not officially supported. Naturally, Microsoft being Microsoft, not all browsers are equal. Silverlight integration leads to a better ‘experience’ with Office Web Apps, such as using ClearType to improve the display of fonts.

If you are still reading and not confused, let’s correct that… there’s a third solution from Microsoft involving web access to documents – Docs.com. Docs is built on Office 2010 and Office Web Apps but is not from the Office or SharePoint teams. It has come out of Microsoft’s FUSE Labs. Docs includes integration with Facebook for creating and sharing documents with your Facebook friends. Docs is currently in beta so no news on licensing or integration with its related consumer and business siblings…

My closing thoughts

I’m disappointed but not surprised that Microsoft has made a prize mess of the licensing for Office Web Apps. In attempting to first and foremost protect their Office revenue stream, they’re proving the theory behind the Innovator’s Dilemma.

The licensing of Office Web Apps for business customers presents 3 choices:

1. Purchase/increase/maintain a volume licensing agreement to cover Office 2010 (and SharePoint 2010) for all users, employees and others, who want to access documents in a web browser using Office Web Apps.
2. Continue with the traditional methods – email documents or publish links to SharePoint libraries and people download/open the documents using any Office-compatible client installed on their computer. Naturally Office 2010 is the recommended client for integration with SharePoint.
3. Use alternative browser-based options for viewing/editing Office documents, such as Google Apps or Zoho. Evaluate the cost of the monthly subscription versus Microsoft’s licensing cost. You will also need to consider the cost/value/risk of introducing a different approach to collaboration and productivity applications. This option isn’t for integrating with Office and SharePoint. It replaces them.
4. There is a fourth option – use the free ad-funded consumer versions although those clouds are a little too grey for most organisations to fly into. Security, support and scale being the first three issues to overcome.
5. There’s also the fifth option – reduce your dependency on documents and publish more content direct into web/wiki pages… but maybe a blog post for another day

Focusing on the first three options, one may generate additional revenue for Microsoft, one will reduce revenue and none of the options are likely to increase customer satisfaction or loyalty. The first may prove too expensive to justify the benefits. The second ties Office to the desktop in an era when people want to access content from any browser-capable device. The third introduces a new approach to collaboration and productivity, one that doesn’t need SharePoint or Office (or even a PC)…

A better approach would have been to include the use of Office Web Apps within SharePoint licensing, which is complicated enough when it comes to external access so you may as well kill two birds with one stone. And including Office Web Apps may even help justify increased SharePoint licenses. Anyone who claims this will reduce Office revenue clearly hasn’t been using Office Web Apps, or at least not in the real world. Pushing organisations to try alternatives has far better odds.

Related blog posts:

• Rethinking Office: Comparing Office with Google Docs – April 2008
• Programming Office: Why the shift of apps to the cloud will be slow – May 2008

References:

• Understanding Office 2010 and the Office Web Apps – session at Microsoft’s SharePoint Conference, October 2009
• The twists and turns of Office Web Apps’ software license – Infoworld, February 2010
• Users will need a Microsoft Office licence to use Office Web Apps – ITWriting, May 2010
• Licensing of Office Web Apps when used with SharePoint 2010 – EduGeek Forum, June 2010
• The Innovator’s Dilemma – Clayton Christensen
• Office Web Apps blog
• Windows Live Skydrive / Office Live Workspace
• Docs.com

Microsoft has recently published a TechNet article containing an Overview for SharePoint Workspace 2010. SharePoint Workspace is the new name for Groove, which provides offline collaborative functionality for SharePoint with better synchronisation than is available within Outlook 2010.

Personally, I have been reluctant to encourage the use of Groove/Workspace within organisations unless they have very specific needs. It adds another layer of complexity to managing a SharePoint deployment and is another user interface for people to learn. A classic target scenario for using Groove is one where organisations need to co-create and collaborate on documents with a distributed workforce who aren’t always well-connected to the Internet (people can author offline and Groove synchronises with SharePoint in the background). Or for working beyond an organisation’s boundaries – Groove crosses firewalls better than SharePoint if you don’t have an extranet, although there are less complicated alternatives…

Whilst talking about new names, Windows SharePoint Services is also being rebranded SharePoint Foundation Service. So to give a summary of what goes with what SharePoint name:

I’ve had one client come away from a Microsoft event confused by hearing about over 8 different versions of SharePoint. Microsoft’s acquisition of FAST for more advanced enterprise search capabilities is being listed as part of the SharePoint range. And then there are products such as SharePoint Designer. Further adding to the confusion, there are two different types of licence available for each edition of SharePoint Server.

To keep it simple, think of SharePoint as serving three core scenarios:

1. Storing content and basic collaborative work: Use SharePoint Foundation Services
2. Finding and managing unstructured information (documents and web content), building social networks (personalisation and knowledge sharing): Use SharePoint Server Standard Edition
3. Integrating structured information (applications, data analysis, identity management/single sign-on): Use SharePoint Server Enterprise Edition

If you want advanced search capabilities, add FAST to any one of those three scenarios. If you want offline collaborative working, add SharePoint Workspace or Outlook (2007/2010). If you want to customise how SharePoint works, you’ll be using SharePoint Designer.

From a licensing perspective, SharePoint Foundation Service is included with Windows Server 2008. For SharePoint Server, both Standard and Enterprise, there is a choice between Intranet licensing (for internal use only) and Internet/Extranet licensing (for external use/public web sites). All the extras (FAST, Office etc.) have their own separate licenses.

Here’s a rough matrix to help get a feel for what you get with each SharePoint product:

Click on image to view larger version

Hope that helps a little. Think it’s time to update the old SharePoint History timeline…

So much for publishing soundbites during the recent SharePoint 2009 Conference. What can I say, I got distracted Here’s a delayed one.

Microsoft announced a new product at the conference that has been going under the codename Project Gemini – PowerPivot

PowerPivot is being released as an add-on component to Excel 2010 (licensing not available at time of writing). It’s purpose: analysing massive sets of data using familiar tools. It brings business intelligence (BI) into Excel. Historically, to do such large scale analysis has required specialist tools.

PowerPivot enables incredibly fast filtering and sorting of spreadsheet data extending to 100 million rows. That’s a pretty big dataset for Excel to handle. PowerPivot includes some nifty compression algorithms and the working data set is read only. There are features to enable you to edit related tables that feed into it. With SharePoint 2010 you will be able to display the content and analysis in web parts for browser-only scenarios. And whilst its title suggests it’s a giant PivotTable, PowerPivot is not your traditional Excel pivot table. You can have multiple slices based on related tables to cross-analyse the data. Here’s a couple of images taken from the conference:

In the image above there is the main pivot table (selected in blue) summarising and filtering total purchases by selected continents. To the left and top left of it you can see two slices that are being used to further filter the data by genre and rating

In the image above you can see one of the new functions that are included with PowerPivot, it is creating a sum by matching values in a related table. It’s hard to visualise how different this is to the traditional Excel pivot tables and formulas. One example given during the talk was that PowerPivot could enable historical comparison analysis such as comparing accounting information across financial years.

This is an interesting move for Microsoft as we enter an era where massive amounts of data are being created and shared across the Internet. Finding easy ways to visualise such quantities of data is a hot topic. Microsoft is not the ony one coming up with new tools…

Some reading on how massive amounts of data is challenging conventional wisdom:

• Recent Innovations in method (The Technium, December 2004)
• The Google Way of Science – replacing the hypothesis (The Technium, June 2008)
• The Future is Big Data in the Cloud (GigaOM, October 2009)

Side note: Whilst I can see where Microsoft got the name from, I can’t help but keep calling it PivotPoint instead. Blame SharePoint, PowerPoint and PerformancePoint for that

This is the first in a series of sound bites I’ll be publishing (wi-fi permitting) during the SharePoint 2009 Conference (SPC09) here in Las Vegas. More details will follow after the event.

The SharePoint 2010 product line-up was announced during Steve Ballmer’s keynote on Monday 19th October 2009. And it’s a lot longer list than the current 2007 product range:

As my photography was far from perfect, here’s what’s on that screenshot

On Premise (products you can install)

• SharePoint Foundation 2010 (new name for Windows SharePoint Services)
• SharePoint Server 2010
• FAST Search Server 2010 for SharePoint
• FAST Search Server 2010 for Internet Business
• SharePoint Server 2010 for Internet, Standard edition
• SharePoint Server 2010 for Internet, Enterprise edition

Cloud (online services you access over the Internet)

• SharePoint Online
• SharePoint Online for Internet Sites

Client Access Licenses (CALs)

• Standard (Core)
• Enterprise

Lots of emphasis on SharePoint having 2 paths – on premise (installing servers onsite) and in the cloud (subscribing to online services, with the servers managed in a Microsoft data center)

Not listed on the slide – SharePoint Workspace 2010 (new name for Groove) and a new and much improved SharePoint Designer 2010 (and it will remain free in the next version)

[Update] At a later session, the search line-up was expanded to include Search Server 2010 Express. Yey! Here’s the slide with a summary of the differences between Search Server Express, SharePoint Server and FAST Search Server for SharePoint in the 2010 product range:

Side note: Wandered outside during the break after the keynote and look what I found parked right outside the conference:

Do you think a certain rival is having a bit of fun?