Security's the message for Exchange

Microsoft chief executive Steve Ballmer is expected to elaborate on the new version of Exchange in a speech to business partners Monday at its Fusion conference in Los Angeles.

The new version of Exchange messaging software, which handles e-mail, calendars and contact lists, will be the company's first major update of the product since releasing Exchange 2000 nearly two years ago. Microsoft, which competes against IBM, Novell and others in the market, will release a test version of the new Exchange later this fall, with a final version expected by mid-2003, company executives said.

The new version of Exchange, code-named Titanium, will be more secure because the company will, by default, disable certain messaging features to prevent hackers or virus makers from taking advantage of openings, said Jim Bernardo, Microsoft's Exchange product manager.

In the current version of Exchange, all messaging features are automatically in use when installed. Now, there are fewer security loopholes because features that customers don't need or use are automatically turned off, he said.

The new security measure is based on the results of testing that Microsoft conducted earlier this year after Chairman Bill Gates mandated that security was the company's main priority. Security has long been a problem for Exchange and the Outlook e-mail program because it's a favorite target for virus writers. The new security feature will be built into the new version of Exchange. For existing Exchange users, Microsoft this month will come out with a software update, called a service pack, that will offer the new security measure plus some bug fixes, Bernardo said.

Analysts say the move makes sense.

"The point is that when Microsoft designs features to enable developers and people to take advantage of certain things, that opens hackers to also take advantage," said IDC analyst Mark Levitt. "By locking things down, they're saying 'We will protect you, but we have to take away flexibility.'"

The forthcoming version of Exchange will also be easier to install, Levitt said. The difficulty stemmed from customers having to migrate to Microsoft's new Active Directory, technology that serves as a sort of "white pages" of information about computer users and resources, such as PCs and software.

Half of Microsoft's customers still haven't moved from the older Microsoft Exchange version 5.5 to Exchange 2000, partly because they're happy with the older version of Exchange and partly because it's hard to upgrade to Exchange 2000, Levitt said.

"With Titanium, Microsoft is trying to show that it's paying attention to its customers and making it easer to use," Levitt said.

Ease of use is a big issue because Microsoft is battling IBM's Lotus for the lead of the e-mail and messaging software market, which is expected to reach $1.5 billion in sales this year, according to IDC. While Microsoft's biggest nemesis in the market is Lotus, the company also competes against Novell and newcomer Oracle, which plans to release its own e-mail and messaging software later this year.

"There's money to be made and market share to be grabbed," Levitt added.

Freshening up its Outlook
To coincide with the new version of Exchange, Microsoft will make some cosmetic changes to the Outlook e-mail program.

Outlook will sport a new look, with Microsoft moving the window that previews the text of an e-mail from the bottom of the screen to the right-hand side, Bernardo said.

Another new feature is the ability to group e-mail based on when messages arrived. "It will provide some visual cues and better navigation of what's important and timely in my inbox," he said. "You can group messages from when they came in--today, yesterday, last week, two weeks ago."

Outlook will also feature improvements in sorting mail, including new multicolored flags that people can use to determine each e-mail's importance. Computer users can then put flagged e-mail in multiple folders in their inbox. If they forget where they put the flagged e-mail, they can do a search to find all their important messages all at once, Bernardo said.

In addition, Microsoft plans to spruce up its stripped down Web-based version of the Outlook e-mail program, adding new features to make it as comprehensive as the regular version, he said.

The new version of Exchange will also be more powerful and handle more users and allow network administrators to more easily store company e-mail by taking regular "snapshots" of the data, Bernardo said.

The new version of Exchange will also have Microsoft's Mobile Internet Server built in, allowing companies to more easily send e-mail and calendar information to mobile devices, such as cell phones. Mobile Information Server was previously sold as a standalone product.