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

That isn’t an explanation. It’s an excuse.

Time and again on the Internet, conventional wisdom about what people will and won’t do is challenged by evidence that begs to differ. Grandparents are supposed to be technology-averse and not understand the Internet. That soon changes if their children move abroad and webcams and Facebook are the easiest way to keep in touch and watch the grandchildren grow up. The old argument that nobody bothers to classify information fell flat when Flickr and photo tagging came along.

In short, culture is used as an excuse when the real reason for failure to adopt new systems is because the target audience doesn’t see any value in what they are being asked to do versus what they have been doing in the past. And so they either don’t change or do reluctantly, which can have worse outcomes than not doing anything at all.

Culture matters in the interpretation of how people use systems, how they communicate. But the differences are regional, not organisational. In some countries, talking up your success is perceived negatively as boasting. In others, modesty is misinterpreted as lacking ambition. People in some societies say ‘Yes’ to every question regardless of what the question is asking, sometimes before you’ve even finished asking the qeustion. In others, the default response is ‘No’. Some societies expect permission to be asked before doing something, others admire those who try and ask forgiveness if the outcome doesn’t go to plan. These differences will affect how people communicate and the words they choose to use, verbally and in written form.

If you need to make a judgement based on what people say and do, interpreting information to compensate for cultural differences will improve your chances of making the right decision. But culture does not prevent people from adapting and using new systems.

Systems fail because they are poorly designed and don’t offer benefits to the people expected to use them. It reminds me of a quote from a Gartner conference, that went along the lines:

Ask a sales person what they need from a new system and it’s one requirement – make it easier for me to sell more stuff. Ask a sales manager and you’ll get 400 requirements on how to report, analyse and manage what gets sold.

The latter gets built and its failure will have nothing to do with culture (or technology for that matter) and everything to do with creating a system that takes longer to sell anything at all.

This blog post will look at what has changed since the previous event held last December, and will be a shorter post than the original series. Some content was repeated or similar and reading the first series would be a good place to start, beginning with Dell B2B Social Media Huddle – Part 1 (December 2009).

Overall, the tone was more muted this time and focused on the reality of social media, mixing lessons learned in how to benefit from social media with examples that question its value in a business-to-business (B2B) context. I suspect that’s because business-to-business examples are far more likely to be found under the umbrella of Enterprise 2.0 than Social Media. At this event, there was a lot more emphasis on social media for advertising and marketing.

Does Social Media Matter?

12 months ago, the first time Domino’s Pizza management heard about what their employees had been up to on YouTube was when they were tipped off by a blogger. The incident was considered a case study in why businesses should be more actively monitoring and participating in social media. But Domino’s did react quickly once notifed and, 12 months later, has any damage been done to the brand? The evidence suggests you can fail miserably (initially) at social media, the judgement comes more from your reaction and how you get out of a bad situation rather than how you got into it…

During one of the unconference sessions, the presenter Ciaran Norris played a video of IKEA leveraging Facebook for social media marketing. IKEA created a profile, uploaded photos and whoever was first to tag an item in the photo won the item. Held up as a great example of how to engage your audience, what’s the benefit? Outside those who received free goods, does it change anyone else’s opinion? Decide for yourself:

Whilst I’m unconvinced about how much value was generated from this one-time limited lucky dip, for sure some value was created. And that’s perhaps the point we have reached with social media…

What’s the Return on Inaction?

With businesses struggling to put a value on social media efforts, making any potential return on investment hard to predict, an alternative approach was offered – evaluating the return on inaction. (You could equally use ‘Risk on Inaction’.) What happens if you do nothing? In the era of telephones, if your customers all had telephones would you choose not to have one? What’s the value of that telephone? How about the value of having an email address? Or web site?…

Whilst I’m getting more than a little tired of videos displaying trends to a thumping tune designed to have everyone reacting in amazement, the numbers do illustrate just how far we have travelled down the rabbit hole in to Internet wonderland.

Target who you interact with…

It was interesting to observe at the event how Dell and Cisco continue to expand their social media efforts to reach a larger audience. Both have multiple accounts on Twitter and fan pages/groups on Facebook. For brands, it seems the more successful use of Social Media come from specalisation, connecting with multiple but very specific audiences rather than the generic TV method of targeting everyone/stereotypes. It would be prohibitively expensive to create specialist adverts for print and TV media, but not so with social networks.

…and let your targets find you

I’ve tweeted my frustration at seeing Nokia target my Facebook profile with pink versions of their outdated phones, when the only data they have to go on is that my profile gender is female. That is no different to a stereotyped TV advert. The successful uses of online sites like Facebook and Twitter involve creating channels that people want to join. We ignore banners splattered around the site then go visit the fan page of a brand. They are both advertising mechanisms. Facebook’s challenge is that it is currently trying to monetise using the old fashioned format rather than the new. Just as the advertising industry never thought online text ads would work when Google first introduced them to finance a search engine, the same disruptive thinking is needed if advertising is to also finance a social network.

“Be careful what you wish for…”

It’s that age old quote and one to consider by all businesses tentatively engaging in social media to promote sales. Back to the IKEA example. Technically, they broke Facebook’s terms of service (ToS) by creating a profile to advertise their products. And the idea has recently spawned fake imitations with fans being duped into handing over  personal details to con artists – see IKEA Imposter attracts thousands of Facebook fans per hour. Unlikely to cause long-term damage to IKEA but time and resources are now required to monitor and manage the social media channels they have chosen to participate in.

To wrap-up, the repeating message throughout the event was that social media will take time and resources, and you will fail at some point. The medium is too unpredictable to not fail, as IKEA is now learning. It’s how you respond and adjust that will make all the difference. With all the pitfalls, it may feel tempting to try and ignore social media. But the simple fact is, you can’t. It’s like the telephone, email and web sites. In their early days, they were a luxury. But once they became established, to not participate is to not be in business. Once you overcome the realisation that avoiding social media is pointless, you can start to focus on the unique benefits it can offer that justify managing those inevitable pitfalls.

Twitter has brought down barriers to communicate with people you would previously have struggled to connect with

Mel Carson talked through lessons learned by Microsoft Advertising as they began to engage in social media. This quote was the highlight and is applicable to everyone. For Mel, it resulted in getting Stephen Fry to attend a meeting. Whilst you might not secure a visit from Mr Fry to your birthday party, there is nothing stopping you from contacting him, direct, through Twitter. It is becoming common for TV shows to include a Twitter hashtags. Two examples from the BBC – The Virtual Revolution and Wonders of the Solar System. In both cases, the presenters continue to be active on Twitter and will happily argue discuss their point with you. At this event, it was interesting to note that all but two presenters in the brochure had included their Twitter IDs.

This post has summarised some of the content from the excellent Dell B2B Social Media Huddle. A follow up post will look specifically at B2B and B2E (internal) uses of social media. Thanks again to Kerry Bridges and Neville Hobson for organising, and Mel Carson from Microsoft for hosting.

Presentations from the event:

• Microsoft Advertising: Learning and Earning through social media
• Internet Advertising Bureau: How to pull George Clooney
• Ciaran Norris – How to make social media work
• Rob Shimmin – Why CEOs don’t tweet

References:

• Dominos Pizza defends reputation on Twitter after YouTube video shows employees abusing food – Telegraph, April 2009
• Case study: The fall and rise of Vichy – Shel Israel, June 2005
• Ikea is Facebook’s new Frenemy – brandchannel, April 2010
• Why is digital advertising so lousy? – Washington Post, May 2010
• Business to Business Social Media – Benjamin Ellis, May 2010
• Video presentations on B2B social media – from the event, May 2010

Related blog posts: Social Media tag

To repeat the two headlines in the image:

• An Open Letter to our Valued Customers
• AT&T Hikes Smartphone Early Termination Fees…

Which one do you feel inclined to read first?

For me, an organisation can only use a sentence containing the phrase ‘Our Valued Customers’ when they are giving something back, of value, to said valued customers. On the Social Media Monopoly board, AT&T PR does not get to go past Go or collect £200. A more honest title of ‘Changes to our early termination fees’ would have been much better.

Click Here to view more posts on Social Media

Increased Channels of Communication

Simply having more channels through which to communicate is not a benefit unless you use them effectively. Respond to one customer via Twitter or Facebook and you will set an expectation for all customers. Do you have the resources to meet that expectation? If not, your reputation for failure will spread faster and wider than any positive feedback. Before you start increasing those communication channels, make sure you plan and budget for the resources required to manage them effectively.

More Collaboration = Better Outcome

No it does not. It might lead to a better outcome but increasing collaboration does not guarantee any benefits whatsoever. A simple example: How many people attend meetings that achieve nothing? That’s collaboration without an outcome. There is an excellent book on collaboration called… drum roll… Collaboration, written by Morten T. Hansen. The book argues, in great detail and with plenty of research, that bad collaboration is worse than no collaboration at all. And then goes on to outline the steps you need to take to ensure that more collaboration does lead to better outcomes.

To benefit from Social Media requires more than simply adopting the tools and techniques of Social Media. It requires discipline. And that includes knowing when not to participate. From the book Collaboration, most failures boiled down to two mistakes: Overestimating the potential value from collaboration and underestimating the costs.

So back to the two examples and what to do:

Increased Channels of Communication

Every organisation should look into what channels of communication its audience use and ask the simple question. If your customers are using that channel, are you? And if not, why not? If you decide to participate, think carefully about what resources you are prepared to invest in to make the participation work. If your resources are limited, be transparent about it. The more human the response, the better the reaction.

Increased Collaboration

Read the book! But, in short. Take a disciplined approach to collaboration. Identify where better collaboration can improve outcomes. Identify what barriers are currently preventing that collaboration from taking place. Identify what investment is required to enable better collaboration and overcome the barriers. Decide if the investment is worth the potential outcomes and, if it is, do it! Equally, identify where collaboration isn’t leading to better outcomes and stop it. Reduce those unnecessary meetings…

References:

• The benefits of Social Media in the B2B Workplace – Social Media B2B
• Collaboration by Morten T. Hansen, published 2009 by Harvard Business Press

Related blog posts:

• Dell B2B Social Media Huddle – The Business Case for Social Media

The report includes a chart showing which applications are the main priorities for moving to being delivered as an online service via cloud computing. Web conferencing tops the list with 66% although I was surprised to see Email only make it to 4th place with 44%. Given the cost and effort spent on maintaining in-house email systems, often running without encryption and with no difference in management of purely internal email versus email sent across the Internet, shifting Email servers online seems a logical priority to save costs and improve service. Instead, salesforce automation (64%) and accounting/billing (49%) have both jumped above email and collaboration is just behind it at 43%.

Also interesting to see the vendor choice for online services – 67% of survey respondents using Amazon.com and 77% using Amazon’s Elastic Compute Cloud service (EC2) with VMWare dominating internal virtualisation, used by 83% of respondents.

The New York Times had an article – With a Kindle Hiring Spree, Amazon Gears Up for Battle With Apple. The article goes on to debate will Apple’s new iPad kill the Kindle or not.

The answer is somewhat answered in an article on TechCrunch – Kindle for Android Hits This Summer. Opening with the author commenting how one of his favourite apps for the iPad is the Kindle app and how it now looks like the Kindle app will also be available on the Android. Seems to me, Amazon is being pretty quick to leverage those APIs and get its product everyone. The Kindle is becoming less about the physical device and more about a portable mechanism for buying, reading and annotating books…

There’s the age old quote “In the pursuit of digging for gold, you want to be the business selling shovels…” Can’t remember the exact wording, or the source. It was first told to me by a business mentor… but I digress.

The final article from yesterday was from the SmoothSpan Blog – Amazon Stealing the Cloud. The blog post covers various statistics that show just how many businesses are using Amazon’s various cloud services. Amazon isn’t just leveraging APIs to support its retail business, the technology side of Amazon is providing both APIs and the platform on which to host and run them – the spades, the barn, the wheelbarrow… everything you could possibly need to go digging for gold.

Interesting times…

To summarise the presentation:

• Darwin identified that finches lived in a very remote location meaning the variations had to compete with each other to survive. The finches you see today are the winners
• At the start of the 20th Century, retail business was primarily local within villages, towns and cities, selling direct to people. With the evolution of suburbia, we saw the shift from the corner shop to the shopping mall with each mall containing mostly the same retail brands – business went from direct to indirect. The big brands at the end of the 20th Century were the winners
• At the start of the 21st Century, web-based business was ‘local’ to the web site, selling direct to visitors. With the evolution of social networks and mobile devices, we are seeing a shift from visiting the corner-shop equivalent web site to the mall equivalent – lots of businesses hosted on the same web platform, be it micro-applications on your mobile phone or applications in widgets on a social networking site. To be one of those applications means using APIs (application programming interfaces). How important is it?:

80% of web-based traffic will be coming from beyond the browser…

If you are doing business online, you need developers who understand APIs