SEATTLE (Reuters) - Microsoft Corp
launched new Office software for home
users on Tuesday, featuring constantly
updated, online access to documents
from all kinds of devices as the world's
largest software company attempts to
tailor its most profitable product to a
mobile generation.
The new Office suite of applications -
including desktop staples Outlook email,
Excel, Word and PowerPoint - is aimed at
home users rather than businesses, and is
designed to extend Microsoft's
domination of the workplace to the home
office and beat back growing competition
from Google Inc's free online apps.
"The notion of an always up-to-date
streaming version of Office comes directly
from how people are using devices
today," said Kurt DelBene, head of
Microsoft's Office unit, in a phone
interview. "You really want all your
content to roam with you. We see that as
an opportunity to deliver what customers
are asking for."
The version of the new software launched
on Tuesday, called Office 365 Home
Premium, is the first major overhaul of
Office since 2010. Big companies, which
generally buy Microsoft's software under
multi-year contracts, already got the
latest features of the new Office in
December.
Tuesday was the first look for individual
customers, and initial reactions were
positive at Microsoft's flagship Seattle
store.
"It looks badass. And that whole touch-
screen thing now," said Kouichi Armga, 25,
who works at Trader Joe's grocery store
and studies at the University of
Washington in Tacoma, after seeing the
new Office run on touch-screen hardware.
"It was actually very impressive," said
Jeremy Payne, 26, from Olympia,
Washington, who works in retail and is
studying public relations at the local
Evergreen State College. "The biggest
thing was the new PowerPoint. I was
really excited to see the new
PowerPoint."
Payne, an avowed Apple Inc enthusiast,
said the new Office was "really rad," but
it might be hard to drag Mac users away
from their Apple-centered world.
"They have their work cut out for them
pulling people from Apple," he said. "The
Apple system is so integrated to my way
of thought."
DOWNLOAD UPDATES
After downloading the basic programs
online, users can access the latest
versions of all Office applications from up
to five devices on a subscription basis for
$100 a year.
The software will be updated online,
marking a change from the past where
users had to wait years for upgrades to
installed software.
It is the latest step in what Chief
Executive Steve Ballmer called Microsoft's
"transformation to a devices and services
business," making the company more like
Apple.
The new Office largely adopts the look of
last year's Windows 8, with a cleaner,
more modern-looking design and includes
touch-screen capability.
The "ribbons" showing commands in Word
and Excel are mostly unchanged. For the
first time the package includes online
calling and video service Skype, which
Microsoft bought in 2011.
Users' work can be stored on their
devices but also in remote data centers -
known as the cloud - and the latest
version of a document can accessed from
any licensed device with a browser.
GOOGLE KILLER?
Two and a half years in the making, the
new Office is designed to extend
Microsoft's domination of the business
market and counter the growing
popularity of Google Apps, a collection of
online-only, Office-style applications
Google provides free for home users and
sells to businesses for $50 per user per
year.
Microsoft is hoping its move into online
services, alongside its new Surface
tablets, will push it into the forefront of
mobile computing, which has been led by
Google's Android software and Apple's
combination of slick hardware and apps.
"Microsoft Office remains the gold
standard for productivity applications,"
said Avi Greengart, research director at
Current Analysis. "It is bringing Office
fully into today's connected, cloud-based
environment. But it still has more work to
do to make it fully finger-friendly for use
on its own Windows tablets."
The new Office will run natively on
Microsoft's own Surface tablets - both the
'RT' and Pro versions running on ARM
Holdings and Intel Corp chips respectively
- but it will not run natively on Apple's
iPad, disappointing some iPad users who
are also Office fans.
"We have not said that we will do rich
client software on the iPad at this point,"
said DelBene, although he did not rule
out producing such software in the
future. "We've been very logical in our
approach. I'm pleased with the software
we have delivered for the iPad to date,"
he said.
Microsoft's SkyDrive online storage
system and its OneNote note-taking
software are available as iPad apps, and
iPad users can use limited Web versions
of some Office applications.
The iPad issue has been a long-time
quandary for Microsoft, which might gain
more mobile users by making Office
available on the iPad but would have to
give Apple a cut of its subscriptions.
Availability of Office on iPads would also
take away a major incentive to buying its
own competing Surface tablet.
Microsoft estimates that 1 billion people
worldwide use some part of Office and
the unit that produces Office is
Microsoft's most profitable, edging out
the flagship Windows division for the last
few years. It now accounts for more than
half of Microsoft's overall profit.
Sales dipped last quarter as consumers
held off in anticipation of the new Office,
but analysts expects sales to ramp up this
quarter.
"In the immediate next year or two, this
version of Office should help many of the
core small and midsize enterprise
customers stay with Office," said Al Hilwa
at tech research firm IDC. "The value
proposition for the consumer space has
always stemmed from synergies with the
enterprise. I don't think this is going to
change." (Additional reporting by Eric M.
Johnson. Editing by Matt Driskill and
Steve Orlofsky)
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