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Kurt DelBene

Microsoft is expected to launch its Office 365 service tomorrow, charging businesses a monthly subscription — rather than a one-time licensing fee — for online versions of SharePoint, Exchange, the Lync communications server and desktop versions of Office.

In a recent interview with GeekWire, the president of the Microsoft Office division, Kurt DelBene, described the service as part of a wholesale shift in mindset for the Office team.

“I tell my developers, think about the cloud as the primary offering,” DelBene said. “We will continue to do the on-premises product, but the kinds of things that you invest in for the cloud version of our product will also benefit people on premises as well. That means over time, everybody in my organization thinks about cloud first, and thinks about how do I also deliver those on-premises as well.”

Google isn’t buying it. The company today delivered a pre-emptive strike in the form of a blog post titled, “365 reasons to consider Google Apps.”

“You can’t just take legacy, desktop software, move some of it to a data center and call it ‘cloud,’ ” writes Shan Sinha, Google Apps Product Manager (and a former Microsoftie), in the post. “Apps was born for the web and we’ve been serving hundreds of millions of users for years.”

Microsoft will be looking to take advantage of the fact that many businesses are already using its desktop and server programs, potentially making them more comfortable sticking with the company as they make the shift to cloud-based productivity and communications technology. The company will be pitching them on the concept of reducing or eliminating their IT maintenance and hardware costs.

DelBene said he believes Office 365, the successor to the company’s Business Productivity Online Suite, will also allow Microsoft to compete for a larger portion of its existing customers’ technology spending, while attracting new customers from the ranks of small and medium businesses.

“These are a very large set of customers that have historically not embraced our server offerings to the degree that our enterprise customers have,” he said. “So we think that’s upside, as well. We definitely think this is a business opportunity.”

Stay tuned for more on the Office 365 launch Tuesday morning.

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