Q&A: Microsoft bCentral Enhances Strategy and Service Offerings to Deliver Greater Integration to Small Business

REDMOND, Wash., Oct. 2, 2001 — Microsoft bCentral announced an evolution of its small-business strategy that allows customers to build on the services they know and trust to extend their businesses into the online arena. Greater integration, not only with bCentral’s own offerings but also with Microsoft Office and Microsoft Great Plains, reinforces bCentrals focus on providing small companies the best set of business applications built on the Microsoft .NET platform, allowing them to do business better — any time, any place and on any device. A key to the evolution of these services is providing small businesses with solutions that help them build and maintain a successful online presence and better manage business operations.

Satya Nadella, bCentrals vice president, recently spoke with Press Pass about this evolution in bCentral services and what they mean for the small-business customer.

Press Pass: Why is bCentral changing its strategy?

Nadella: bCentrals strategy hasnt really changed. Were still committed to helping small businesses manage their everyday business processes better. bCentrals solutions are cutting-edge, and as new and better ways to serve customers present themselves, we add them to the mix of solutions we offer. Our goal is to provide the best set of business applications built on the .NET platform.

Our customers told us they wanted to see better integration — among bCentral services, as well as with Microsoft Office and Microsoft Great Plains. They wanted it to be easier to use these services together everyday. They wanted a combination of hosted and on-premise services. And, I am pleased to say, we heard what they told us and have made changes that we think will allow small companies to do business better — any time, any place and on any device.

PressPass: How has Microsoft’s acquisition of Great Plains influenced bCentral?

Nadella: Our strategy was impacted by the Great Plains acquisition in a very positive way. Great Plains and bCentral share a common vision to provide interconnected solutions to the business market that combine on-premise and hosted services that enhance how companies work with their employees, customers, suppliers and business partners. Were now seeing how this shared vision translates into solutions for the market — and these changes were talking about today is great proof of how well the two groups are working together.

PressPass: Can you explain bCentrals mission to help small businesses build and maintain a successful online presence?

Nadella: Customers who build and maintain a Web site through bCentral will see a whole lot of added value. Were improving the ability to update and grow their online presence by adding even more powerful Web authoring tools to our base service offering — either Microsoft FrontPage or Microsoft Publisher. Many of our customers were already using FrontPage to update their Web sites and they asked us to make it easier for them to continue this practice. They wanted to combine their hosted services with a feature-rich, on-premise solution like FrontPage. And we listened. Were really enhancing the core offerings provided by bCentral. Now its easier than ever for small business to customize their Web sites to meet their own unique business needs.

Weve also doubled the amount of disk space each Web site customer receives, with options starting at 100MB. This lets customers build and maintain even larger sites as their businesses grow. Were dramatically increasing the number of e-mail boxes each business gets, giving them more options to integrate Office applications like Outlook and Outlook Express, and almost doubling the data transfer limits. The more traffic the business sees online, the better. There are more comprehensive report options now for customers as well — to tell them whos visiting their site, when, how often and more. These reports are easier than ever to generate.

These added-value hosting options are due in large part to our new hosting partner, XO Communications. Were very pleased to deepen our relationship with one of the worlds leading providers of broadband communications services. They have a great track record for customer service and for providing superior performance and reliability. We know bCentral customers will be in good hands.

PressPass: How does the new strategy help bCentral customers better manage business operations?

Nadella: This is where our integration with Microsoft Great Plains really begins to take shape, with Great Plains Small Business Manager. This is a complete business management solution for small business — it provides end-to-end solutions for managing everyday business processes like accounting, payroll, sales and purchasing. It takes customers beyond Finance Manager and offers a more comprehensive solution to meet their business management needs. Another great thing about Small Business Manager is that is has built in scalability — so it can grow with the small business.

Customers were looking for an on-premise solution, since having all their financial data online wasnt a preferred method of operation — but they still have hosted options. The real win here is the opportunity to integrate this on-premise solution with hosted bCentral services like Commerce Manager. Or they can share some of this important data with suppliers or employees using SharePoint. Again, its all about the individual business need and customizing a set of solutions that will help that business prosper.

PressPass: How will these changes impact current bCentral customers?

Nadella: Our customers now have a new world of options at their fingertips. Current subscribers to Business Web Services will see their solution changing to Web Hosting, and will now have powerful on-premise solutions like FrontPage and Publisher to maintain and update their Web sites. Plus, they now have a much more compelling hosting solution with more disk space for larger Web sites, more e-mail accounts, increased data-transfer capabilities and more thorough reporting abilities. Weve also beefed up our support options to help customers with any questions they may have.

The other impact is for current Finance Manager customers. They can upgrade to Great Plains Small Business Manager to manage a range of business management tasks beyond accounting. We think this solution will be a much better fit for the needs of the small company. Plus its a great introduction to the diverse business management solutions available from Microsoft Great Plains, with a clear upward migration path. As our business customer grows, so, too, do the software solutions we provide to meet their changing needs.

PressPass: Why is Great Plains Small Business Manager a better choice for customers than Finance Manager?

Nadella: One of Finance Managers key customer benefits was offering secure, anytime access to accounting data — Small Business Manager is that, plus much more. Small Business Manager is a comprehensive, end-to-end business management solution that helps businesses manage all their key financial tasks. It takes a step beyond accounting to include integrated solutions for payroll, banking, sales and purchasing tasks. There are also quick and easy reporting options as well as access to online views of key business information. This allows a small business to make the smart business decisions it needs to make, faster and with greater efficiency. Another benefit is Small Business Managers scalability — as the business grows, so does the solution. And once that small business has grown beyond being

small,” it offers a clear upward migration into the mid-market enterprise space. We think that Small Business Manager will be a robust and user-friendly tool for small companies across the country that will allow them to manage the tasks they need to manage to build their businesses every day.

PressPass: For those bCentral customers who need to build and manage their small business Web site, how will the customer experience differ from using Site Manager to Front Page?

Nadella: Probably the biggest difference is that FrontPage is an on-premise solution. Customers no longer need to be online to update their Web sites — they can make the changes they want right on their desktops and then upload them to the Web. We think this will be an easy transition for customers — many of them are already using FrontPage to manage their bCentral Web site and asked us for the type of integration thats now available. The FrontPage solution has a wide range of additional service options and tools to help customers build and manage a really comprehensive Web site.

PressPass: When and how did you notify your customers of this change?

Nadella: We started talking directly with customers about these changes at the end of September. Given our target for transitioning customer accounts in November, we wanted to make sure they had time to understand how their service was being impacted and what their options were. Weve talked to customers about this in a variety of ways — on the phone, through e-mail and the Web, via comprehensive Q & As as well as live chat. Weve beefed up our online support information and continue to add additional pieces as new questions come to light. Our telephone support has increased its hours of operation, and during the November timeframe, will be available to take questions 24 hours a day, seven days a week. We will be contacting customers at several points during this service evolution, to ensure they are making decisions that are right for their own unique business needs.

PressPass: Did Microsoft conduct any research or receive any customer input to indicate that these changes would better meet their core business needs?

Nadella: We talk to our customers all the time. bCentral is in a unique position at Microsoft in that we are delivering services directly to our customers or through very tightly integrated partners — so there are numerous opportunities for interaction. We continually receive e-mails with questions and comments about our services. Our customer support center receives similar feedback by telephone. In addition, we regularly conduct primary research to learn more about customer satisfaction and areas for improvement. Weve incorporated a lot of customer requests into our service evolution. And we will continue to seek their feedback as we go forward, to ensure that our offerings are win-win, for both our small business customer base and for bCentral.

PressPass: What’s next for bCentral?

Nadella: bCentral remains firmly committed to helping small businesses manage their everyday business processes better — any time, any place and on any device. We will be looking to continue to integrate our solutions with those that matter to our customers — we will be deepening our relationship with Office and Great Plains, as well as exploring new opportunities for value-added partnerships. We want to enhance the relationships we have with our channel partners, so that small businesses have a wider network of support as they extend their businesses more and more into the online arena.

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