Microsoft Revisits Web Service Plan

Although Microsoft Office generates one-third to one-half of the software giant's revenue each year, Microsoft is concerned about slowing sales of the last two releases, Office 2003 and Office XP. To jumpstart Office revenues, the company is reviving some older, previously abandoned strategies, such as subscription Web services, as it copes with an interim Office release, Office 12. Until recently, Microsoft had planned to launch Office 12 with the desktop version of Longhorn, the often-delayed next major Windows version.
  
The problems facing the Office team are obvious. Although most Office applications are decades-old, mature products, they've also grown stale. Nevertheless, convincing customers to upgrade to newer versions is increasingly difficult. After all, what more can the company add to its stalwart word processing solution, Microsoft Office Word? Word's broad feature set hasn't really changed since the mid-1990s and probably never will. In the current Office version, Office 2003, Microsoft did something it hasn't done for years; the company added two new major applications, Microsoft Office InfoPath and Microsoft Office OneNote. But although both applications have been well received, neither is likely to dramatically change the Office team's financial picture.
  
In response to this situation, Microsoft is turning to the Web services strategy that it originally plied with a since-canceled project called Net Docs. But this time the company will apply the strategy to the core Office suite applications, not to a new Office-like product. Word, Microsoft Office Excel, OneNote, Microsoft Office Outlook, and the other Microsoft Office System applications will continue as standalone applications but will also be used as spokes in a collaborative system that will use Web services for intra-application communication. And because they're built on Web standards, these services can be used to interact with Office applications and servers that are locally available on users' hard disks or are remotely accessible via the Internet.
  
So will a more collaborative Office suite resonate with customers? Microsoft touted the collaboration features of the past several Office releases, but Office 2003 is the first release to work natively with Web services. This capability clearly will be a stepping-stone for the features Microsoft plans to add to Office 12. But collaboration scenarios have yet to set enterprises on fire, despite their easily described productivity benefits. Whether the company can reverse this trend in Office 12 remains to be seen.

Though Microsoft Office generates a third to one-half of the software giant's revenues each year, the company is concerned about the declining sales trends of the previous two versions, Office 2003 and Office XP. That means Microsoft is once again reviving some older, previously abandoned strategies for jumpstarting Office revenues, including subscription Web services, as the company copes with an interim Office release, dubbed Office 12, which will now pre-date Longhorn, the oft-delayed next major Windows version. Until recently, Office 12 was to have launched alongside the desktop version of Longhorn.

 

The problems facing the Office team are obvious: Though most Office applications are decades-old, mature products, they've also grown stale, and it's getting increasingly hard to convince customers to upgrade to newer versions. After all, what more can be added to the company's stalwart word processing solution, Microsoft Word? The broad feature set of the word processor hasn't really changed since the mid-1990's and probably never will. In the current Office version, Office 2003, Microsoft did something it hadn't done in years, adding two major new applications to the Office family, InfoPath and OneNote. But thought both applications were well received, neither will likely change the Office team's financial picture dramatically.

 

In response to this, Microsoft is once again turning to a Web services strategy it originally plied with a since canceled project called Net Docs. But this time, the Net Docs principles may be applied to the core Office suite applications and not to a new Office-like product. The idea is that Word, Excel, Outlook, OneNote, and the other Office System applications will continue as standalone applications, but will also be used as spokes in a collaborative system that will use Web services for intra-application communications. And because they're built on Web standards, these services can be used to interact with Office applications and servers that are locally available on the user's hard drive, or remotely accessible via the Internet.

 

So will a more collaborative Office suite resonate with customers? Microsoft has been touting Office's collaboration features for the past several versions, but Office 2003 is the first to natively work with Web services. This capability, clearly, will be a stepping stone for the features Microsoft will add to Office 12. But collaboration scenarios have yet to set enterprises on fire, despite the easily described productivity benefits. Whether the company can reverse this trend in Office 12 remains to be seen.

TAGS: Windows 8
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