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Microsoft pulls plug on midmarket server

Who needs Microsoft's Windows Essential Business Server? Not many, apparently. The product made little sense from the start.

The decision by Microsoft to deep-six its Windows Essential Business Server

More resources on Microsoft Windows Essential Business Server
Microsoft unveils new Windows Small Business Server

Microsoft juices SMB push with server bundle

The company said last week it will end development of the Windows Essential Business Server (EBS) SKU as of June 30. The bundle, which has been available since November 2008, combined Windows Server, Exchange Server, System Center Essentials, Forefront Security for Exchange and ISA Server. It targeted midmarket enterprises with up to 300 end users that had outgrown the 75-seat limit on Microsoft's Small Business Server.

Microsoft said the product, which listed for about $7,000, could save these companies a lot of money compared to the full license cost of the individual components. The problem was it never took off.

George Podolak, IT director for Pei Freed Cobb & Partners, a New York-based architecture firm, was one of Microsoft's original EBS user references. And yet, even his firm decided to forgo installing the server.

"Nope, [EBS] didn't happen here," Podolak said. "If I'm a brand new user, starting from scratch, this could be a nice way to set up my network. But, if you're an established user, you have SQL Server, Exchange and AD [Active Directory] it's a bit scary and iffy to move that. There's no benefit and it's risky."

The product's life span was extremely short. "I'm not sure it made it through a full fiscal year," said analyst Paul DeGroot of Directions on Microsoft. "This sort of bundling may not work well for server environments. If you're a company big enough to use this product, you probably already have much of this infrastructure or you're using Hosted Exchange, which is attractive for many customers."

Another issue was that target companies typically had limited or no IT staff and so needed a partner to help with implementation. Once a partner is involved, the company might as well buy and install exactly what's needed and not be constrained by EBS (Essential Business Server) licensing, DeGroot said. "If you need a partner to put in EBS, then you're getting the worst of both worlds -- a cookie cutter license bundle, which may not be exactly what you want and you're still paying a partner to deploy."

Michael Cherry, also an analyst at Directions on Microsoft, said EBS also suffered from a case of bad timing.

"It was the right product at the wrong time. It made it easier to have a single admin manage everything, [but] it also required three physical servers and hit right as virtualization was taking off and people were reducing the number of servers," Cherry said.

To install EBS, companies needed three 64-bit servers to run the bundle, an additional server for the Premium Edition to run Windows Server 2008 and SQL Server 2008 for line-of-business applications.

Microsoft said there are no plans to change the company's Small Business Server bundle.

Let us know what you think about the story; email Barbara Darrow, Senior News Director at, or follow us on twitter.

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