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Recently, many users of Microsoft (News - Alert) Windows Live services, particularly Live Hotmail and MSN Messenger, found they were suddenly unable to access those services. Initial reports indicated the outage was limited to the United States, but user forums and blog comments show that users worldwide appeared to have difficulty accessing the Live services.

 

The Live services outage has caused legitimate questions to be raised by Redmond Channel Partner (News - Alert) (RCP) Online, with regards to Software as a Service (Saas). Live Hotmail and MSN Messenger are consumer services, not critical to most businesses, and Microsoft does not offer any service guarantee. However, the outage has questioned the viability of business SaaS (News - Alert) applications as well, such as CRM and ERP software, which also can be hosted by Microsoft partners.

 

Business enterprise software can be kept in-house or outsourced, and although the Live Hotmail and MSN Messenger software are not equivalent to business-critical software, such as CRM or ERP, the outage does raise concerns for business and IT decision makers as to the viability of the hosted model.

 

For instance, if the outage occurred in software used by 400 million Microsoft Hotmail users worldwide, what is the likelihood an outage could occur with their critical business applications hosted on a third-party server.

Despite the publicity of the Hotmail and Messenger outage, providers of SaaS applications insist they have never experienced this kind of downtime. SaaS providers, such as Salesforce.com (News - Alert), highlight their proven availability and performance, and they do show service interruptions and performance issues on their public Web sites. Similarly Netsuite.com guarantees 99.5% uptime across all of their applications.

Although the SaaS providers offer high uptime availability and Microsoft has greater reliability when it comes to its business critical applications, the recent Hotmail and MSN Messenger outage does raise a red flag. For businesses using SaaS applications, though the chances of an outage similar to the recent Hotmail one is remote, it does highlight there are certain risks associated with hosted software that extend beyond a businesses sphere of influence.