Microsoft to Pour $3 Billion Into Office

By Peter Galli  |  Posted 2002-09-23 Print this article Print

Software giant hopes to double its annual revenue from Office to $20 billion by 2010.

MOUNTAIN VIEW, Calif.—Microsoft Corp. plans to spend more than $3 billion over the next three years on its Office productivity suite and hopes to double annual revenue from Office to $20 billion by 2010. "I have a $20 billion dream for Office, but the product will be so much more than what we think of today. There will be new categories of application value from a client standpoint, as well as around servers and XML services. "We can create enough value for this business to grow 10 percent a year over the next 10 years, giving us some $10 billion annually in revenue growth, alone, at the end of that time," said Jeff Raikes, Microsofts group vice president of productivity and business services, in a presentation at Microsofts campus here on Monday afternoon.
Small-to-medium sized businesses are currently underserved with business applications, relatively compared to the large business market, he said. "This decade will see people demanding that they are able to interact electronically with all businesses, so my goal with the Great Plains and Navision acquisitions is to offer far more than just great accounting software.
"I want to offer great value for SMBs when they move onto the Internet and help them work better with their partners, and I see that market and that demand boosting our business around that to $10 billion a year," Raikes said. Raikes also expects to see another wave of value around information work in the next decade that will significantly outpace the enormous growth of the past two decades. "We have seen major waves of value in information work over past two decades, from the creation of spreadsheets and word processors in the early 1980s to the integration of digital tools for creating content in the 1990s based around a graphical user interface," he said. But there are many challenges today, involving connecting people, software and services. There are many disconnected islands of data, problems with becoming connected to business processes and inefficient collaboration, said Raikes. Over the next decade, Microsoft will use three pillars to drive its information productivity business forward: It will serve a broader customer audience, create new customer value through innovation and help customers realize business value, Raikes said.

Peter Galli has been a financial/technology reporter for 12 years at leading publications in South Africa, the UK and the US. He has been Investment Editor of South Africa's Business Day Newspaper, the sister publication of the Financial Times of London.

He was also Group Financial Communications Manager for First National Bank, the second largest banking group in South Africa before moving on to become Executive News Editor of Business Report, the largest daily financial newspaper in South Africa, owned by the global Independent Newspapers group.

He was responsible for a national reporting team of 20 based in four bureaus. He also edited and contributed to its weekly technology page, and launched a financial and technology radio service supplying daily news bulletins to the national broadcaster, the South African Broadcasting Corporation, which were then distributed to some 50 radio stations across the country.

He was then transferred to San Francisco as Business Report's U.S. Correspondent to cover Silicon Valley, trade and finance between the US, Europe and emerging markets like South Africa. After serving that role for more than two years, he joined eWeek as a Senior Editor, covering software platforms in August 2000.

He has comprehensively covered Microsoft and its Windows and .Net platforms, as well as the many legal challenges it has faced. He has also focused on Sun Microsystems and its Solaris operating environment, Java and Unix offerings. He covers developments in the open source community, particularly around the Linux kernel and the effects it will have on the enterprise.

He has written extensively about new products for the Linux and Unix platforms, the development of open standards and critically looked at the potential Linux has to offer an alternative operating system and platform to Windows, .Net and Unix-based solutions like Solaris.

His interviews with senior industry executives include Microsoft CEO Steve Ballmer, Linus Torvalds, the original developer of the Linux operating system, Sun CEO Scot McNealy, and Bill Zeitler, a senior vice president at IBM.

For numerous examples of his writing you can search under his name at the eWEEK Website at


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