Microsoft cuts price of online apps

Redmond responds to Google assault.

Microsoft is cutting the cost of its hosted versions of Exchange, SharePoint and Office Communications Server, and rolling the services out to 15 new countries this week.

The firm said that the hosted Business Productivity Online Suite and Exchange Online, Office SharePoint Online and Office Communications Online will be reduced to just US$10 per user per month, for a minimum five-seat subscription.

Microsoft said that its online services are regularly updated, and that the latest versions include increased mailbox storage of 25GB, and new administration scripting tools.

The addition of new country versions, including Brazil, Chile, Colombia, Czech Republic, Greece, Hong Kong, Hungary, Israel, Malaysia, Mexico and Poland, will bring the availability to 36 countries and regions.

Today's announcement was made by Microsoft business division president Stephen Elop, who named a number of new customers including McDonald's.

"Global organisations, such as McDonald's, Rexel Group and Tyco, are choosing Microsoft Online Services for the rich capabilities, flexibility and value they deliver," he said.

"In just a year, we have grown to 36 countries and more than a million paying users, and we are not slowing down. We will continue to bring new innovations and deliver the software and services businesses need to succeed."

Microsoft is facing stiff competition from Google in the hosted applications marketplace, and these latest moves will seen as an attempt to win back some ground.

Google recently snagged a deal to provide online apps to 30,000 workers at Los Angeles City Council, a former Microsoft customer, and has launched a major marketing campaign.