Microsoft is set to announce pricing and licensing details for its Office Live Communications Server 2003, entering the final stretch for delivery of the enterprise instant messaging (IM) product by the end of the year.

The estimated retail price for the product, previously known as Office Real Time Communications Server 2003 and by its "Greenwich" code name, will be US$929 for the server software and $34.95 per client access license, said Ed Simnett, lead product manager at Microsoft.

Details on availability, specifically release to manufacturing of Office Live Communications Server 2003, are expected soon, possibly later in the week, according to sources familiar with Microsoft's plans. General availability of the IM product is scheduled for later this year, a company spokesman said.

The licensing plan for Office Live Communications Server 2003 is in line with other Microsoft server products. Customers who place large orders typically get discounts. Software Assurance, Microsoft's software maintenance plan, costs 25 percent of the licence fee per year, the percentage Microsoft charges for all its server software products.

Pricing for Office Live Communications Server 2003 is "reasonable" for a customer who needs internal IM and compared with prices for other Microsoft server products, said Matt Rosoff, an analyst with independent research company Directions on Microsoft, in Kirkland, Washington.

However, Rosoff does not think there is a lot of pent-up demand for enterprise IM. "Based on the general tenor of what we heard from IT managers, a lot of them are not convinced of the value of real-time messaging. You'll find traction in the media and finance industry where instantaneous communications is really necessary."

Office Live Communications Server 2003 allows companies to run their own enterprise IM network, addressing security concerns related to public IM networks and allowing companies to log and manage IM usage by employees.

"CIOs (chief information officers) are looking at instant messaging and want to get it under control, inside their own infrastructure," Microsoft's Simnett said. "They are nervous about the public infrastructure."

Microsoft's enterprise IM server also offers integration of IM capabilities with other Microsoft products. For example, in Outlook a user can see if a sender of an e-mail is online and start an IM chat from inside the e-mail client.

The Windows Messenger 5.0 client software used with the new enterprise IM server supports MSN Messenger, Exchange 2000 IM Service and Office Live Communications Server 2003. Administrators can choose to switch off MSN Messenger, locking out the public IM service. Also available is MSN Messenger Connect for Enterprises, enforcing enterprise IM policies such as naming of users and IM logging when using the public IM network, Microsoft said.

A single version of Office Live Communications Server 2003 can handle up to 10,000 clients. The server software runs on Windows Server 2003 and requires Active Directory. A SQL Server database is needed for logging of IM traffic. Minimum recommended hardware is a system with dual Pentium III processors at 1.4GHz, 2G bytes of RAM and two 36.4G-byte Ultra2 SCSI hard drives, Microsoft said.