Microsoft recently announced that they will be ending one of their most popular Server products, the Microsoft Windows Small Business Server. With cloud services becoming more and more popular, Microsoft intentions are obvious in that they are pushing their customers and partners to use cloud services like Office 365. But why is this such a problem?
I originally wrote this back in 2012 but I never completed the upload. So, I’ve posted this now in 2026 with the original post-date of when I wrote this as a bit of archival of my writing from the time when SBS was a hit.
Small Business Server History
The Small Business Server became a hit back in the Windows 2000-era when it was the first to combine Microsoft top enterprise products and produce a simple all-in-one solution aimed at small business (duh). This server contained an Active Directory Domain Controller, Exchange Server, SharePoint, Remote Access server, and more. For small business this was a god send.
Back when first released, internet was slow and offsite mail solutions were costly. So being able to host not only mail, but complete solutions onsite was a no-brainer.
Most offsite solutions could only offer POP3 email which also costed the business on a per-mailbox basis which soon added up when you grew to 10+ mailboxes. Also, central data solutions often resulted in one of the office workstations being the central point or even worse was the files being distributed by disk or email (remember that this was external POP3 email too!). Overall, just terrible!
So when the SBS was developed, there was finally a solution for small businesses were they could host onsite their own mail server which would save them money on internet usage and mailbox costs. Instead of going to the net to send internal mail, this was now kept within the local network. Files could now be saved on a central server that could be configured with domain security and user security rights. People could now easily work from home by either accessing the web interfaces hosted by the SBS or directly access their work computer.
These technologies were refined over time and new versions of the server contained the latest versions of Exchange and Sharepoint packages and connected better with the latest version of the Windows client OS. Even better, later versions were better support and accepted by the Apple Mac products further erasing the barrier between Windows and Mac.
Partner Powerhouse
Because this server product made it so acceptable by small businesses, it was easy to sell and partners and resellers were confident selling it. It was easy to configure, maintain and support, and money could be made from it. The SBS less of a Microsoft sale and more of a Partner sale which has been the Microsoft business model for decades, right down to the humble desktop.
However, in the latest news, Microsoft have stated that SBS 2011 will officially be the end of that Server line and there will now longer be a all-in-one packages like it. In 2012, we will see the start of its replacement, the Windows Server 2012 Essentials. This server will comprise of the ease-to-build as in SBS, the domain controller but will be with Exchange and Sharepoint. Doesn’t seem like much on paper, it is huge to the community.
Exchange was the big selling point for the server in that companies could host and manage their mail system and save money on hosting costs. It also meant that a small business could operate like a big business without the cost of buying several servers and high costs of licensing each product.
Moving to the Cloud
The new SBS will now integrate with Microsoft’s cloud solution Office 365 which is a paid hosted service containing mail (Exchange), and hosted document solutions. No longer will mail be hosted on site, but moved to the cloud. Same with company collaboration, file sharing and more. While the SBS can be used for local file storage, there is support to move it to the cloud. Also the SBS will continue to provide domain level management and system backups.
From what I can see is that Microsoft is no longer allowing their partners run the show and want more pieces of the pie. Let me explain.
The SBS is more-or-less a one off sale for Microsoft. Once they sell the licence for the software, the server is sold to the customer, installed and (in the right circumstances) runs for many years before it is time for an upgrade. IT companies can profit by offering continued support and maintenance on the software and hardware, but Microsoft won’t see a penny from it.
For many years now, Microsoft have been trying to work a subscription model into their products will almost no success. The most obvious example was attempting to sell Office on a 12-month subjection. But for a little more you could buy the licence, why would you lease it?
Sadly they have worked this subscription model into the SBS. Instead of selling the services in the product, they have removed the services and hosted them. By hosting them, you a required to subscribe to the services in order to use the technology they used to build into the product.
What they didn’t realised by doing this is that they have essentially destroy and entire sector of IT business who sold and supported the SBS product. Despite offering solutions where these IT support companies can customise the Office 365 to look like it is coming from the IT company, this isn’t a solution. Although we are in the year 2012, internet connects are still pretty terrible for a lot of us. And for business to now go to the cloud for their business is still not an option. Wireless internet and wired internet is still not a stage where we can fully operate from it. Not to mention the on-going cost of mailboxes (funny how it has gone full circle).
AI was used to generate the Featured Image of this Post.
If you enjoyed this post, check out my other Windows Small Business Server posts, or leave a comment.