Microsoft Executive Raises Hope for Office iPhone Edition

SAN FRANCISCO—Stephen Elop, president of Microsoft Business Division, voiced vague indications at Web 2.0 Expo that Microsoft will eventually offer a mobile version of Office for the iPhone, a move that has been rumored for almost as long as Apple’s smartphone has been on the market.

Tim O’Reilly, CEO of O’Reilly Media, the organizer of the Web 2.0 conference, asked Elop whether Microsoft was really committed to getting its major productivity applications running on the Web and on mobile devices.

Elop said Microsoft recognizes that there is a growing demand from smartphone users for access to a variety Web applications and productivity applications. For example, he noted that many people are accessing their Facebook accounts with their iPhones because the devices and mobile operating systems have evolved to make it practical to access Web applications like Facebook and a host of others.

While the users of iPhones and other smartphone models can access Word, Excel and PowerPoint files, they also want to be able to edit them from their smartphones.

O’Reilly asked Elop if this meant that iPhone users would eventually get access to a mobile edition of Microsoft Office. “Not yet—keep watching,” Elop said.

Elop also said Microsoft is still planning to introduce an “ad-supported” Web edition of its bread-and-butter Office suite, something that the company has been talking about since it introduced its Office Live Web application services for small businesses in early 2006.

He said Microsoft is actively working on the latest iteration of a Web-based Office package, but the release of even beta application code “won’t be in this calendar year.”

Part of the problem, Elop said, is that Microsoft has to be very careful about how it builds the user interface for the Web or for mobile applications. Microsoft Office is used by more than 500 million people around the world. The company has to take care that it doesn’t fundamentally change the interface so that all those millions of people don’t have to relearn how to use the application, he said.

Microsoft’s goal is not to deliver an Office Web application that responds to the supposed challenge of Google Docs, Elop said. The objective is to deliver real innovation and value in a Web application service that enterprise users will be willing to use and pay for.

Google Docs may be free, but Microsoft will succeed with Web applications “only if we are delivering value well beyond” elementary features such as bolding and underlining in the browser, Elop said.

The greatest threat to Office is not from Web applications like Google Docs, Elop contends. The danger is that Microsoft will stop innovating and improving Office and its other products, he said.

With the recession, he said, “Microsoft is taking a lot of heat” from financial market analysts, who say the company should boost profitability in part by slashing research and development costs. He noted that Microsoft spent about $9 billion in research and development and is resisting the calls for cutbacks. “We have to continue to innovate, and that is something that we are committed to."

Elop contends that enterprise customers are discovering the value of Web applications such as social networks, wikis, blogs and data portals. “What’s happening behind the firewall is the same as what is happening on the Web,” Elop said. The difference is that “with the enterprise you can translate that value into something that companies are willing to pay for,” he said.