Moving server software to the cloud has a lot of advantages. A company no longer has to worry about patches, deploying upgrades, and an number of other concerns.
But it also has one big downside--one that many CIOs are still struggling with--a the loss of control.
"They do lose control, when they move to a cloud-based service, of some things," Microsoft Senior Vice President Chris Capossela said during a lunch meeting on Wednesday. "They lose control of when things get updates. They lose control of saying 'no' to some new thing."
Capossela acknowledged that many technology executives, even those who are shifting work to the cloud, see it as a mixed bag.
"On Mondays, Wednesdays, and Fridays they hate it, and on Tuesdays and Thursdays they are really excited by it," Capossela said. "What I mean by that is they see the excitement and the benefits of it and they are also scared of it."
To the end user, it doesn't make a huge difference; Microsoft's software looks basically the same whether it is running in a customer's data center or as a service from Microsoft. If anything, the service customers are happier because they get new versions more quickly.
However, to the IT department, those two scenarios look very different. When they run the software on their own, customers have to budget for upgrades, manage installations, and monitor servers. In the latter scenario, the company doesn't do any of that but at a different cost: they have little say which versions of the software are running.
For the smaller companies that use Microsoft's online versions of SharePoint, Exchange, and other software, Microsoft decides when to move to a new version--typically quite soon after its release.
"Some people are fine with that and some people are totally freaked out about it," Capossela said. "They definitely do that gut check."
For example, today's corporate customers are running Exchange 2007, but the company plans to shift to the new Exchange 2010 and SharePoint 2010 later this year.
Larger companies that have their own dedicated servers within Microsoft's data center have slightly more say. But even they have only a relatively narrow 12-month window to deploy new releases.
"They don't have a choice of saying 'No, I don't want to go,'" Capossela said. "They have a choice of saying when, within the next 12 months, do I go."
Capossela said that there are some good reasons why that sense of control can be hard to let go of, particularly given the way some technology companies have upgraded their services, such as Google's addition of Buzz to Gmail or Facebook's many unpopular revamps.
"It definitely is seeping into their psyche now that the cloud savings and the currency--always being current--comes at a loss of control," he said.
Microsoft doesn't say how many businesses are using its online services, but Capossela said that some 40 million end users that are running some paid hosted service from Microsoft--either SharePoint Online, Exchange Online, or LiveMeeting, or the Exchange Hosted Servcies in which a customer runs their own e-mail servers but uses Microsoft to provide things such as spam filtering and virus detection.
Clarification: A Microsoft representative said that Capossela misspoke in describing the update process. Both large customers with dedicated servers as well as customers on shared infrastructure have a 12-month window to adopt major updates to the service, such as those done when a new version is released.
For more minor updates customers of all sizes receive notice of an update, but not the option to delay or cancel it.