Telstra joins Microsoft's online foray

Microsoft is expected to announce a world-first strategic alliance with Telstra this week as the software giant's chief executive, Steve Ballmer, briefs key Australian partners and customers on its cloud computing strategy.

The alliance is tipped to take in the telecommunication company's nascent T-Suite platform, which will offer software over the internet to small and medium-sized businesses — a market that is dominated by Microsoft products.

A range of other products and services are expected to be included in the agreement.

The announcement would come a week after the world's largest software maker unveiled new details of its internet strategy, including the Azure cloud computing platform, web versions of Office applications and details of its latest operating system, Windows 7.

Microsoft is under increasing pressure online from rivals such as Google and Salesforce.com, which are pushing hard to sign corporate and government computer users up to web-based, software-as-a-service applications.

But while Microsoft plans to host its own software, it is also turning to prospective partners such as Telstra to help push its products out online to the hundreds of thousands of SME customers it does not typically deal with directly.

Hosted software is expected to come to the fore as the economy tightens and businesses look to cut capital costs by relying more on outsourced computer and telecommunications services.

Microsoft Australia and Telstra representatives yesterday declined to comment on the alliance. Ballmer is scheduled to speak at a customer dinner hosted by Telstra chief executive Sol Trujillo on Thursday.

Separately, Telstra confirmed that it plans to launch T-Suite commercially next year and gave pricings for some of the product categories it will offer.

Telstra business group managing director Deena Shiff said the company is in discussions with more than 50 local and multinational software developers who could offer their technology through T-Suite.

She also said that the software-as-a-service platform would provide productivity, security and business continuity products with pricing starting at A$4 a month for desktop security and rising to at least A$19.95 a month for collaboration software.

Microsoft remains the largest supplier of office productivity applications and email systems in Australia, despite the efforts of competitors such as IBM and Google to unseat it.

— Australian Financial Review