Microsoft partly outsources Commerce Server development

Microsoft said Wednesday that it will begin partnering with a Gatineau, Quebec-based company for future development, marketing and support of its Commerce Server software for building e-commerce Web sites.

As part of the agreement, Cactus Commerce will work with Microsoft to deliver enhancements to Commerce Server 2007 as well as a set of "solution accelerators" for the e-commerce technology. The two companies said that the new offerings are scheduled to start appearing in the second half of next year, with rollouts continuing at least until the end of 2010 under the deal.

Cactus said it plans to add more than 125 employees over the next 12 to 18 months as a result of the alliance, nearly doubling its workforce. Most of the new employees will work at a 15,000-square-foot research and development office in Ottawa that Cactus will open this fall.

Commerce Server, which is based on Microsoft's .Net technology, competes with similar products from vendors such as IBM, BroadVision, Art Technology Group and Escalate.

Microsoft shipped Commerce Server 2007 last year, its first update of the product since 2002. A Service Pack 1 release with bug fixes and new functionality was made available for download this June.

Nevertheless, Microsoft has had to repeatedly reassure customers about its long-term commitment to Commerce Server. For example, in a statement as part of the announcement with Cactus, Ryan Donovan, Microsoft's product unit manager for Commerce Server, said that the software vendor is increasing its overall investment in Commerce Server.

"Our joint partnership with Cactus Commerce improves and extends the development of the Commerce Server platform with a predictable long-term technology road map," Donovan said. Cactus, he added, will provide specialized industry and technical expertise that Microsoft itself lacks.