Having finally peeled the beta sticker off its Office 365 service, Microsoft looks set (at long last) to compete with the likes of Google in the cloud-based office productivity market.

The toolset is pretty impressive, including online versions of Word, Excel and other Office applications (Microsoft Office Web Apps) plus cloud-based storage and access to hosted implementations of its Exchange and SharePoint servers. An online version of the company's unified communication solution - Lync  Server 2010 - is similarly bundled with the service.

Lync Online is a particularly interesting component, giving subscribers access to presence information both within the Office 365 product set itself and through local Outlook clients. It also delivers instant messaging and both audio and video and conferencing facilities without the need for an on-premise UC infrastructure.

It's not a full implementation of Lync, however. Office 365 subscribers can make PC-to-PC VoIP calls, but the online version lacks the full PBX telephony and PSTN connectivity available with the in-house version of the product.

According to the Office 365 blog, this may be added later, but for now Microsoft is pointing small business customers at partners, such as BT, to deliver the missing telephony components. It's also bundling licences for the on-premise Lync server as part of high end enterprise price plans for the Office 365 service.

A number of other features have also been left out of the online version, full details of which are available on the Office 365 Community website at  http://community.office365.com/en-us/w/lync/480.aspx.

This doesn't mention Skype or how this acquisition fits into the Office 365 equation. Partly because it came too late to be included although, as announced at the launch event, plans are afoot for closer integration between Lync Server and Skype once the acquisition dust has settled.

This article is written by Alan Stevens and sponsored by Avaya. The opinions reflected in this piece are solely those of Alan Stevens and may not reflect those of Avaya management