The new version of Microsoft Office integrates comprehensively with the web, can edit PDFs and is built to use Microsoft’s new Windows 8 operating system for tablets and PCs.
Microsoft Office, used by more than a billion people and running on around 90 per cent of business PCs, is the single largest component of Microsoft’s revenue, bringing in more than $15billion per year for the company.
A preview of the new version, which will be called Office 2013 and is not expected to launch until next year, was unveiled at an event in San Francisco. Steve Ballmer, Microsoft’s Chief Executive, claimed the software was “a new generation that brings some of the same boldness and beauty that we’ve shown you in Windows 8 and Windows Phone”. He added, “This is the most ambitious release of Microsoft office that we’ve ever done”, and emphasised that it was aimed as much at students, busy families and consumers as it was aimed at businesses.
The range of applications, including Word, Outlook, Excel, OneNote and PowerPoint have all been updated to improve how they use the touch interfaces increasingly required by users who have phones and tablets. More than half of all users now have three devices or more, and 60 per cent say they use the same devices in their work and personal lives, Microsoft claims. Although note-taking programme OneNote has been comprehensively redesigned to include touch support, the bulk of the applications have been polished to improve their overall functionality so they work better on both tablets and PCs.
Microsoft Word, for instance, can now edit PDFs as well as save in the Adobe format, and has added the ability to embed YouTube clips more easily. Users are encouraged to log on so that all devices, from tablets to phones or PCs, return directly to exactly the same point when a document is reopened. A ‘reading mode’ has also been added to encourage tablet users to read more on their devices. All programmes will now integrate with Microsoft’s cloud storage system, SkyDrive, to offer permanently up-to-date and easily accessible documents.
Microsoft Outlook has been altered so that ‘peaks’ of the calendar or contact details can be layered on top of the main mail window, allowing users to keep Outlook as their entire main screen on either tablets or PCs. New add-on applications can also automatically scan emails for addresses and show locations, or look for suggested meetings and generate appointments.
PowerPoint now has an enhanced presentation mode, too, allowing users to project their documents onto a screen while simultaneously viewing their notes and slides on a tablet or PC. The updated OneNote integrates improved tablet functions such as touch and handwriting recognition, and adds a new ‘radial menu’ offering easier ways to change font size and characteristics using fingers rather than a mouse and keyboard.
Microsoft has also added more social networking elements aimed at businesses, allowing users to ‘follow’ colleagues and documents and tasks as they might follow friends or brands on Facebook. The company recently purchased business social network Yammer for $1.2billion, and will also integrate its other purchase, Skype, allowing calls and instant messaging to be built directly into Office software. Collaboration has been augmented with new video conferencing and live collaborative document editing tools.
Forrester analyst Sarah Rotman Epps said that the new software would sell well and offered excellent new functions. But she added that even “products at the peak of their success can still be vulnerable to disruption, and Office 2013 certainly is, especially to competitors who put mobile first, and who deliver less-good experiences for cheap or free”.
Microsoft’s dominance is being challenged by Google’s Apps suite, which typically allows companies to save significant amounts of money by offering its internet-based software for less than $50 per user per year. Microsoft has responded by cutting the price of its more fully featured rival, Office 365, to a similar price. Both companies now offer free, cut-down versions of their productivity programmes. Microsoft will sell Office 2013 as a standalone piece of software, and will also offer its subscription-based Office 365 software in parallel. Microsoft provided no news on when it would update the software it offers for iPad, but it is expected to work on more platforms in the near future.
Windows 8 is expected to launch in October and will be available on traditional Intel-based devies and new ones that use Arm processors. The latter will run a cut-down version, called Windows RT, and will not include all the Office programmes. Outlook, for instance will not be available and users will need to use the standard 'Mail' client.
For the nine-month period to the end of March, the Office division generated operating profit of $11.6 billion, which was slightly more than half Microsoft’s total operating profit. Microsoft Exchange also runs more than 80 per cent of business email, according to Gartner.