Microsoft had a week full of events, including the launch of Office 2010 and SharePoint 2010 for business customers, the release of its social-networking-focused Kin phones, and another legal twist in its long-running courtroom battle against i4i over Microsoft Word. Microsoft clearly hopes that strong sales of Office 2010 will convince the public of the continued viability of desktop productivity software, despite the increased prevalence of cloud-based applications such as Google Apps. The Kin phones, on the other hand, mark the first release in Microsoft's new mobile strategy.
Microsoft's week centered on arguably its biggest software launch since
Windows 7: the final versions of Office 2010 and SharePoint 2010, released to
business customers on May 12. In keeping with Microsoft's long-running attempts
to make every major software release into a national event, the company
gathered journalists, analysts and customers on the New
York set of "Saturday Night Live" for a
talk by Stephen Elop, president of Microsoft's Business Division.
"Organizations are adjusting to the new economic realities," Elop
told the audience. "Our customers are responding to a changing face of the
workforce: the Millennial Generation, people who communicate in different
ways." Another goal of Office 2010, he added, was to meet its users' expectations
about an increasingly mobile and cloud-based workplace.
"Our employees expect the same technologies at home as in the
workplace," Elop said. "They want all of those technologies to work
very well and seamlessly together."
faces two challenges with regard to Office 2010.
The first is persuading
its customers, particularly businesses with restricted IT budgets following the
recession, that the newest version of its productivity software warrants an
upgrade. Unlike Windows 7, seen by many as the antidote to the much-maligned Vista
and a necessary upgrade from the stable-but-aging Windows XP, Office 2010
succeeds a relatively recent and well-regarded version-perhaps leaving
customers to ask, "Why upgrade?"
Seeking to counter that objection, Elop spent a portion of his presentation
focusing on Office 2010's supposed ability to "reduce costs" and
ignite "significant gains in productivity."
The other challenge comes from cloud-based productivity software such as
Google Apps. Although Google only held 0.09 percent of the productivity software
market by revenue in 2009, according to Gartner, the popular perception is that
the growing popularity of cloud computing will soon translate into substantial
gains for Google Apps and its ilk. As a countermove, Microsoft is offering
free, stripped-down editions of OneNote, Excel, Word and PowerPoint to Windows
Live subscribers via the browser.
Since Microsoft still needs Office to generate revenue, however, many of the
top-shelf features of those applications are restricted to the full,
Google, recognizing the increased allure of cloud-based productivity,
decided that the launch of Office 2010 meant it was time for a little counter-programming
of its own.
"If you're considering upgrading Office with Office, we'd encourage you
to consider an alternative: upgrading Office with Google Docs," Matthew
Glotzbach, Google enterprise product management director, wrote in a May 11
posting on the Official Google Enterprise Blog. "If you choose this path,
upgrade means what it's supposed to mean: effortless, affordable and delivering
on a remarkable increase in employee productivity."
Google Docs offers a way to "end the endless cycle of upgrades,"
Glotzbach added, noting that the supposed cost of upgrading to Google's
offering would only be "a server or two."
In the long term, Google Docs and cloud-based productivity applications
could represent a more substantial threat to the Office franchise, according to
"I think we are likely to see a surprising number of folks look at Docs
as the quick and easy way to get to features quickly during the Office 2010
upgrade cycle," Rob Enderle of the Enderle Group wrote in an e-mail to
eWEEK on May 11, "because it will be vastly easier than getting budget
approval and vastly faster than waiting for the rollout of Office 2010."
Microsoft's other big release of the week, the Kin phones, made their debut
through Verizon on May 13. The Kin One and Kin Two, intended to appeal to a
younger, social-networking-centric demographic, feature hardware and software designed
to deliver a constant stream of updates and other social data.
Kin One will retail for $49.99 and the Kin Two for $99.99,
after a $100
mail-in rebate with a two-year service plan. Talk plans start at $39.99 per
month, while e-mail and Web for Smartphone plans start at $29.99 for unlimited
monthly access. That price may prove a bit steep for teenagers, especially
considering that the devices lack smartphone features such as app downloading;
however, Microsoft is reportedly saying the Kin platform could eventually merge
with its upcoming Windows Phone 7, which would expand the Kin's functionality.
Before that potential hurdle can be overcome, though, the Kin has to deal
with mixed reviews from a number of blogs and tech sites, which generally
praise the phones' ability to upload content to the cloud but also express
reservations about the user interface, slowness to receive new social
networking updates and a few hardware issues.
Ultimately, as with Office 2010, the marketplace prospects of the Kin will
be dependent on a broad range of factors.
"Success will depend on how well Studio and Windows Live support
integrate with the phone, and since only Microsoft can deploy a new service to
the device, how well it does so is critical," Jack Gold, principal analyst
of J. Gold Associates, wrote in an April 13 research note. "Success will
also depend on what types of service plans are available, how they're priced
and how good the service is (i.e., the AT&T/iPhone fiasco would be a killer
for Kin). Finally, what specialized services will the carriers offer to try and
garner some of the potential cloud revenue?"
Verizon is the exclusive carrier of the Kin in the United
States, while Vodafone will perform those
duties in Germany,
and the United Kingdom
later in 2010.
Sandwiched between those major releases came news
of no less import to Microsoft's fortunes
: the company faced another
setback in the long-running intellectual property case leveled against it by Toronto-based
i4i, as the U.S. Patent and Trademark Office confirmed the validity of a patent
allegedly infringed by the software giant.
"This is a very material step in our litigation against
Microsoft," Loudon Owen, chairman of i4i, wrote in a May 11 statement.
"Put simply: i4i's patent is unequivocally valid. Even though Microsoft
attacked i4i's patent claims with its full arsenal, the Patent Office agreed
with i4i and confirmed the validity of our '449 patent.'"
U.S. Patent 5,787,499 "infuses life into the use of Extensible Mark Up
Language (XML) and dramatically enhances the ability to structure what was
previously unstructured data," Owen continued. "As the magnitude of
data grows exponentially, this is a critical technological bridge to
controlling and managing this sprawling octopus of data and converting it into
useful information." More germane to i4i, though, is that Microsoft Word
2003 and 2007 allegedly feature coding that violates the patent's properties
with regard to custom XML.
"We are disappointed," Kevin Kutz, Microsoft's director of public
affairs, said in a May 11 statement, "but there still remain important
matters of patent law at stake, and we are considering our options [for
getting] them addressed, including a petition to the Supreme Court."