Is Microsoft Office 2003 Worth the Upgrade?
Tue Jul 15, 1:14 PM ET Add Technology - NewsFactor to My Yahoo!
Vincent Ryan, www.NewsFactor.com
There’s no way around it. Microsoft (Nasdaq: MSFT - news) Office 2003, the upgrade to Microsoft’s productivity suite set to be released in the second half of this year, is a “tweener.” It is not a major upgrade that ushers in a new era of features and functionality, but it does provide a number of welcome enhancements, especially for enterprise (news - web sites) users.
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Office 2003 has some compelling elements that will entice many enterprises to evaluate and test drive it, even though few may eventually plunk down cash for the upgrade. The most significant of those elements is the suite’s support for Extensible Markup Language (XML), a de facto standard data format for Web services. By supporting XML, Microsoft is adding a whole new twist to Office, one that will eventually take the suite far from its original roots.
XML Plumbing
With Office 2003, Microsoft’s strategic direction for the suite has changed. Microsoft has moved away from adding “kitchen sink” features to Office and instead is focusing on connecting Office 2003 to other forms of data and applications through support of the XML format, Ken Smiley, director at Forrester Research, told NewsFactor. The upgrade is the first incremental step in turning Office from a set of individual desktop applications to a portal for Web services within the enterprise, Smiley said.
Office 2003 will enable enterprises to take data from backend systems and instead of trying to access it through a browser bring it directly into applications such as Word and Excel, manipulate that data, and save it in a format understandable to the backend system. “The XML data source will reside on the backend server and be subject to Web services calls,” Smiley said.
Enterprise IT managers are excited about the Office 2003 and the opportunity to customize how an application like Word relates to a backend application, Dana Gardner, senior research analyst at the Yankee Group, told NewsFactor. Front end that corporate users are familiar with can now be tied into backend applications processes in a way previous versions of Office would not allow, Gardner said.
“It creates interoperability in a way that was not there before,” he said. “Custom developers and people in large organizations trying to bind together process and information technology will see this as a great advantage.”
The first way organizations will probably use Office’s XML capabilities is through InfoPath, a tool for building XML-based templates for structured documents, Smiley said. Organizations will be able to use the InfoPath wizard to create form-driven applications for data entry, and they will not have to rely on IT departments to do it. Twenty-five sample forms are included. “It’s a system for taking paper forms and turning them into business processes based on XML,” Smiley said.
However, Microsoft is still determining whether to sell InfoPath as a separate application.
The Catch
Of course, Microsoft’s XML vision for Office comes with some catches. One is that its success partly depends on independent software vendors, who have to get the XML spit out by their backend applications to talk to Microsoft’s XML format, Gardner said. That will be easier than getting enterprise applications such as Siebel (Nasdaq: SEBL - news), PeopleSoft (Nasdaq: PSFT - news), and SAP (NYSE: SAP - news) to talk to Microsoft’s APIs, which requires tedious and expensive customer integration, but it will still require partnerships from ISVs.
“Microsoft recognized that for them to grow their backend systems and toolsets, they needed to exploit Office by opening it just enough [to ISVs], Gardner said. “This is an olive branch.”
The other catch is that the standard edition of Office 2003 will not allow an organization to create a custom XML schema that it can publish and share with its partners, Smiley said. That feature will be available in only the professional and enterprise versions of the product. In the less expensive, standard version, information saved in XML will be stored in the Microsoft native XML schema, a schema that up until now Microsoft has not published.
Enhancing the Apps
For the most part, the other new features of Office 2003 are pedestrian. Headline enhancements include OneNote, a notepad application for disparate data that accepts input from a keyboard, a mouse, a digital pen, or a microphone (OneNote may be unbundled from the Office suite); Information Rights Management, a file-level security application that enables content creators to define who is allowed to open, copy, or edit a protected document; and Business Contact manager, a customer relationship management add-on. Outlook comes with improved spam-filtering technology and message notification, and other pieces of the suite offer minor enhancements.
“We expect the OneNote application will help drive the tablet PC marketplace,” Peter Kastner, chief research officer at Aberdeen Group, told NewsFactor.
The Outlook client is one of the most important improvements because the wide area network and LAN characteristics of the messaging client change dramatically, Kastner said. Outlook will normally be offline instead of online. “There will be much less network traffic going back to the server to retrieve already sent email items,” Kastner said.
Otherwise, Office 2003’s new feature elements are not likely to cause an upgrade stampede. “The capabilities in the client are not really in themselves a reason to jump quickly,” Gardner said.
Upgrade Inhibitions
A number of factors will actually diminish adoption and sales of Microsoft Office 2003, Smiley said. “I don’t expect enterprise adoption to be more than a few percentage points,” he said. The first is that Microsoft Office will be coming out on its own as opposed to launching in tandem with a new version of the Windows operating system. Second, organizations tend to “skip” a version of the Office suite. For example, most enterprises that bought Microsoft Office XP were moving up from Office 97 and skirted Office 2000 altogether, Smiley said.
Indeed, most enterprises that buy Office 2003 will probably be migrating from Office 2000, he said. “Office 2003 will not be all that attractive to customers who deployed XP,” Smiley said. “If you upgrade too fast, you never get the ROI [return on investment].”
The third and final factor delaying customers from buying Office 2003 will be the complexity of the message Microsoft is trying to send. “This is a new way of thinking about Office that is going to be difficult for clients to wrap their heads around,” Smiley said. “It’s going to take a savvy enterprise to figure out how to [deploy] this.”
For Microsoft, that is not good news, but then keeping users on the company’s continuous upgrade mill has always been a challenge.
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