After years of questioning the value of net-based productivity applications, Microsoft confirmed overnight that it would offer new versions of Word, Excel, and PowerPoint that can run from within a standard web browser.
Microsoft has used its Professional Developer Conference in the US this week to show off browser-based versions of its Office programs.
In an interview, Microsoft Business Division President Stephen Elop said that the browser-based editing capabilities were being developed in conjunction with the next version of Office, known as Office 14. Microsoft won't say when that version will arrive, but Elop said that a technology preview of the browser-based products will come later this year and that a beta version will be released in 2009.
Microsoft will offer browser-based Word, Excel, and PowerPoint in two ways. For consumers, they will be offered via Microsoft's Office Live Web site, while businesses will be able to offer browser-based Office capabilities through Microsoft's SharePoint Server product.
The company has been pushed into this arena by Google, which has been offering its free Google Apps programs for some time. In competing with Google, Microsoft is touting the ability to use Microsoft's familiar user interface, as well as the fact that all of the document's characteristics are preserved. "If you go into some competitive products right now and take a Word document in and then spit it out afterword, it's unrecognisable," Elop said. "You lose a lot of fidelity."
Elop said that not all of the editing capabilities of the desktop products were in the browser versions. "The editing we are characterising as lightweight editing," he said.
Although Google Apps has seen most of its popularity among consumers, it has started to attract attention from corporate customers.
Google Apps got a strong look from Procter & Gamble, which only decided to stick with Office after a strong push from Microsoft. Part of that pitch, Elop said, included Microsoft offering details on its plans for the web-based versions of the Office programs.
"This was part of the conversation, absolutely," Elop said. "We have been sharing with customers under varying circumstances to a greater or lesser extent."
Although he didn't name names, Elop said Microsoft has found itself in a competitive situation with Google in other business accounts as well.
I think Microsoft will do OK in copying the features of Google's web-based office apps. It goes back to corporate strengths. As one of the team of five that was involved in the development of the original electronic spreadsheet (Visicalc) at Harvard Business School, I saw that spreadsheet functionality copied to create Lotus 123, which was in turn copied to create M$ Excel.
Similarly, M$' original word processing software was quite poor, until they set about copying the best features of WordPerfect in the late 1980s to make what we now know as Word. Similarly, M$ copied much of the functionality of Novell to improve M$' networking software, and copied much of Netscape to deliver Internet Explorer. Some (but not all) of Norton Commander's good features ended up in M$' tree-view filer software (Explorer).
In contrast, where M$ has performed worst is when it has found itself 'out in front'. After IE beat Netscape, IE received no functional improvements for five years, till Mozilla's Firefox started grabbing market share for its 'tabbed browsing'... then M$ jumped in to copy that functionality into IE.
Vista copied Linux's approach of asking for a password before allowing changes to the program area...
The issue for Google is that, while Google has first-mover advantage in web apps, it does not yet have that many users 'hooked' on web apps. Conversely, M$ has hundreds of millions of users hooked on its M$ Office offerings, so M$ could come in late/second, yet cause lots of grief to Google in the area of web apps, by closing linking Office and M$' related web apps. OpenOffice has direct add-in support to integrate with Google's web apps, so the alignment may well be Open Source plus Google (ie combined) vs M$ for dominance of this area.
About five years after the dust of battle has cleared I expect the US and EU competition watch-puppies to ask some questions as to whether either M$ or Google misused its market power in other areas to affect competition in this market. The only certainty is that M$ will price at 'free' its products for any market it is attacking, while that same functionality may cost a lot in markets in which it already dominates.