When it comes to corporate email, the Lotus Domino vs. Microsoft Exchange battle is yesterday's news. But Microsoft doesn't have long to prepare for the next incursion as rivals are now tempting businesses with easy-to-manage cloud-based email services.

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VARs report that most organizations that are opting for IBM/Lotus Domino today are doing so to accommodate proprietary applications or because they have remarkably reasonable licensing terms from IBM.

"People are moving off Notes every day. It's antiquated technology," said Ronnie Parisella cofounder and CTO of Primary Support Solutions, a VAR in New York City.

"We find that Exchange is really the de facto standard. Organizations really aren't talking about other platforms," noted Steve Kolbe, CEO of Analysys Enterprises Inc., an IT services provider in Baltimore.

Cloud-based email services on the horizon

But a coming wave of corporate migration inquiries is likely to be inspired this fall by the public beta launch of the Google Wave collaboration and communications platform, which means all bets are off.

Back in January, Forrester Research Inc. reported that 26% of all its client inquiries regarding corporate email pertained to whether or not Google is a viable alternative or whether IBM and Microsoft had truly viable cloud options. The second most frequent inquiry surrounded best practices in email management, which is one of the allures of the cloud approach.

"Mail systems are one corporate application that really remains on the move and something that companies really want to keep up to date," said Kolbe. However, the management challenges associated with doing so have led a growing number of businesses to opt for hosted services that replace in-house mail servers.

At Analysys, for example, 85 cents for every dollar in new business it produces relates to a hosted service. This doesn't just pertain to email, but email applications are one of the first services that many expect to move to cloud platforms. Aside from ridding themselves of a management headache, businesses could cut their support costs substantially, Kolbe said.

For example, an onsite implementation of Microsoft Exchange 2010 with unified communications, email and instant messaging would cost about $12,000 up front for 50 users. A comparable hybrid implementation, hosted offsite by a service provider and made possible with Microsoft's Services Provider Licensing Agreement (SPLA), would cost a business about $650 per month, Kolbe said.

And, Google's option is likely to be a whole lot cheaper, VARs said.

Prepping for Google Wave

A wide-scale beta test of Google Wave will be opened to about 100,000 people in September, according to a blog posting by the Google Wave product manager in late July. About 6,000 developers have already been working with the application, which combines elements of email, file-sharing and instant messaging.

"I honestly believe this release will be bad for me," said Primary Support's Parisella.

Primary Support has already seen a growing number of small and midsized organizations -- those that don't have major compliance concerns -- shift their corporate email accounts to Gmail. For $50 per user, companies can move their entire email domain to the Gmail platform without outsiders realizing it. Google also boosts robust antispam capabilities, he said.

"People are sacrificing features to avoid the cost of managing a server," Parisella said. "We are definitely losing email implementations to cloud offerings."

Then again, certain enterprises will resist outsourcing such sensitive data because their IT policies forbid it. What's more, Google Wave cannot offer the same tight integration with Microsoft Office applications that Exchange supports. For those sorts of businesses, Microsoft's offering -- hosted or otherwise -- remains the most logical solution.

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