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Microsoft Corp., which released its Office XP desktop productivity suite last May, has been hard at work on the next-version upgrade, the first beta of which is due for release later this year. Steven Sinofsky, the senior vice president of Office at Microsoft, in Redmond, Wash., recently talked to eWEEK Senior Editor Peter Galli about the milestones achieved since the release of Office XP and his vision for the product going forward.
eWEEK: It has been more than a year since Office XP was released. What are the highlights of that year for you?
Sinofsky: Office XP showed that there is a bunch of innovation left to do. Weve just started to hit the tip of the iceberg. Im proud of the work we have done on supporting XML in Excel and Access, the work on the user interface with task panes–or smart tags–and our work on collaboration and SharePoint Team Services and integration with other products like SharePoint Portal Server. What were seeing is a breadth of productivity software that we havent seen since the suite was first introduced. Take the example of using a server in your enterprise environment thats much richer and which interacts with external and internal intranets sites.
eWEEK: Some 60 million Office XP licenses have been sold over the past year. How many of these were to enterprises?
Sinofsky: That is the total number of licenses sold for XP since its launch. We do not drill down into detail, but the vast majority of our customers are businesses of all sizes. We also have a lot of customers in education and a small number who buy it at retail.
eWEEK: What are you hearing from customers about what they like and what they want going forward?
Sinofsky: There is a high degree of interest in the new scenarios like real-time collaboration using PowerPoint or collaboration with a server using SharePoint Team Services or XML using Excel. All of those are areas that show the suite goes way beyond being just a word processor or spreadsheet package. Office XP has also been the most stable release weve ever done, and this was through specific innovation in the product in the area of quality with the introduction of things like crash recovery and diagnostic tools. There was also no anticipation or early demand for Service Pack 1, which traditionally fixes bugs, as the product was quite stable. We have also seen a dramatic decline in the viruses around Outlook and also no viruses around Word, Excel and PowerPoint. I wish we could get more people on older versions to install the security work so there will be more of a universal security clamp-down. A lot of the work we put in the client is also being emulated on the server by some corporate administrators to provide a double level of insulation.
eWEEK: Its now more than a year since Office XP was released. What is your focus for the product going forward?
Sinofsky: You can expect to see continued investment in areas like collaboration and XML for analyzing and importing and exporting information. Were still early on the adoption curve of these technologies with many customers. XML technology hasnt quite made it into the mainstream yet, and as we start to improve the support we have on our desktop applications youll start to see people increasingly interact with XML from their desktop or laptop computers. Youll see far more XML-enabled applications talking to Web services that spew out XML, and were planning a lot of work in the areas of communication and collaboration. We started adding e-mail and calendaring and desktop management information in Outlook, and thats going to be the No. 1 area where were investing and innovating. Also, the idea of making organizational intelligence, where XML is used to find and analyze all the key information a customer has, available to Outlook is a key advancement wed like to make.
Smart tags are integral to this. But the next level of XML support is having a server that puts forward a vast amount of XML information, like the entire days sales or reservations, and then have tools like Excel and Outlook able to report or analyze that information. Or have a tool like Word that can mail merge documents to a whole lot of customers from a Web service that allows Word to connect to a data source, say via a URL, and do a mail merge directly from that data source. And that all comes just from using the existing infrastructure information a company has and exposing them in this standardized XML Web service manner. If you take the investments companies have made in business applications like CRM or ERP, where only a few people in the company benefit from that information, Web services will enable many more people to find value in that corporate investment in those applications and systems.
eWEEK: When can we expect a beta for the next version of Office?
Sinofsky: You can expect one this calendar year.
eWEEK: You introduced a subscription model around Office XP in countries like Australia, New Zealand and Brazil last year. How successful was that, and are you planning to expand this to the U.S. and elsewhere in Europe?
Sinofsky: Were always experimenting with different ways companies can acquire our software, with different product variants, different levels of functionality and different mechanisms of purchase. We tried this in countries like Mexico, Brazil, New Zealand, Australia, Peru and Italy. There was a desire for a low cost of entry for the product but with all the features. We have thus tried some pilots around subscriptions, which gives a low cost of entry and you pay for it over time. Were still in the midst of learning from that as you have to at least go through at least one renewal cycle, which is coming up this summer. We will then be able to better understand what the customer experience was like in the real world, and evaluate whether or not people felt it offered enough value at its pricing terms. So well learn some more over the summer and decide if this is a model we want to expand on and move forward with.
eWEEK: Microsoft talks a lot about its .Net and software as a service vision going forward. How will Office fit into that vision going forward?
Sinofsky: The key thing about software as a service is the kinds of scenarios it enables. Software gets better if you have access to services. Office going forward will continue to become a great client for all Web services and the power of XML is that its data that describes itself, so well all be able to communicate with all sorts of services going forward.
eWEEK: Sun [Microsystems Inc.] recently released StarOffice 6.0, which it says is a low-cost, fully functional productivity suite that will challenge Office and attract your users. Is it a threat to Office?
Sinofsky: It is obviously a viable competitor that has a major company backing it. Theyre trying hard to move from the world of free software to paid software where you can have a credible business plan and invest in research and development. But the bottom line is they have to build a better product to be competitive. At the end of the day if a customer is ultra-price-sensitive then he should go and download OpenOffice for free. But you do get what you pay for, and there are no free tickets. The math on what theyre doing is rather tricky, but thats for Sun to figure out.
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