Microsoft Unveils Web-Related Office

As the next step toward a new Internet-based strategy, Microsoft Corp. (Nasdaq: MSFT) unveiled the test version of its latest “Office” software upgrade on Tuesday. The product is designed to serve as a bridge between the old Office productivity suite, which was designed for personal computers, and the company’s new focus on Web-based technology.

Called “Office 10,” the upgrade includes a voice recognition feature that enables users to edit documents by voice commands, the first time such technology has been incorporated into Microsoft’s Office package.

Web Strategy

Shipped to analysts at the beginning of August, Office 10 is the first product to be released under the company’s new “.NET strategy,” which seeks to merge the company’s products and services with Web-based technology.

The product has been getting positive reviews, but most analysts do not anticipate that it will have a major impact. Microsoft is expected to come out with the full-featured Office.NET in 2002, which will be a completely Internet-based service.

The software giant is hoping consumers will take to the latest upgrade more than they did to the previous version, Office 2000, which did not meet sales expectations.

Smart Links

Office 10 features “smart links,” which can recognize personal or company names, and automatically link the user with information such as contacts or stock quotes.

It will support Hotmail, Microsoft’s popular Web-based e-mail service, and MSN Messenger, which lags behind AOL’s Instant Messenger.

The product also offers additional support for Extensible Markup Language (XML), the emerging technology that allows computers to swap information so that workers can easily share documents and other data.

No additional hardware or system upgrades are required.

Need an Upgrade?

Office dominates the desktop market with more than 120 million people using some version of the software suite. Microsoft’s income from Office grew 15 percent during its fiscal year 2000, which was down from the two previous years when revenue grew about 25 percent.

In sales for the fiscal year ending June 30th, Office accounted for about $7 billion (US$) of Microsoft’s $23 billion in total sales.

Though Office 2000 was praised for its abundance of features, many users never felt the need to upgrade. Office 10 will not only include several new features, but will be easier to use than previous versions, the company said.

Facing the Challenge

The software giant is trying to fend off challenges from competitors such as Sun Microsystems, which recently announced plans to produce an open-source version 6.0 of its StarOffice suite in October. StarOffice is designed to run on a variety of operating systems.

Other Microsoft Office rivals include Lotus Development’s Smart Suite and Corel’s WordPerfect.

Microsoft officials would not say how long Office 10 would be tested, but said it was on schedule to be on store shelves by the middle of next year — two years after Office 2000 was introduced to consumers.