XP: The Last of the Desktop Behemoths?

Even as Microsoft Corp. rolled out its latest desktop applications suite, all indications were that Office XP was going to be the last of its kind.

Even as Microsoft Corp. rolled out its latest desktop applications suite, all indications were that Office XP was going to be the last of its kind.

Thats mainly because the Redmond, Wash., companys future will rely increasingly on its .Net platform and its subscription-based services model.

This was evidenced last week during the Office XP launch here when company Chairman and Chief Software Architect Bill Gates actively touted the SharePoint Team Services and smart tags found in the XP product, both of which officials said are basic Web services and .Net features.

Lisa Gurry, an Office product manager, said that the full .Net platform is still a ways away and will play out over the next two to five years. But a Web and subscription offering will form part of the next version of Office, Gurry said.

Microsoft announced late last year that it would offer Office XP on a subscription basis. The first fruits of that initiative are being deployed on a country-by-country basis and are currently only active in Australia and New Zealand, Gurry said. She declined to comment on when the subscription offering will be available in the United States.

Pricing for the Australian subscription offering is as follows: Windows Professional Edition costs users A$359 (Australian dollars) a year over three years, compared with A$1,029 for a one-time upgrade and A$1,288 for a full installation, Gurry said.

If users decline to pay the subscription when it is due, they will be able to open files they already have created but not new ones, she said.

Microsoft President and Chief Operating Officer Rick Belluzzo said plans for the next version of Office, believed to be its Office.Net offering, are still being defined.

Other signs of changes afoot for Office can be found in the move to bring the 400-odd-member NetDocs team under the Office umbrella earlier this year. NetDocs developers were creating an integrated productivity application as part of the .Net initiative.

Dwight Davis, an analyst at Summit Strategies Inc., in Seattle, said he believes the next version of Office will be Office.Net and will be loosely based on NetDocs.

"By the time the next version of Office appears, who knows what will be NetDocs technology and what will be new," Davis said. Nevertheless, as software functionality is increasingly delivered as a service, the subscription model will be applied more often.

"While many people still believe in the benefits of buying a perpetual license, the reality is that these also have an average turnover time of a few years. As such, the subscription model could well appeal to a large user base if priced attractively," Davis said.

Despite lukewarm reaction from IT managers about upgrading to Office XP, Microsoft officials said they are confident about the softwares success.

Microsofts Gurry said while it was "too early to speculate what sales numbers could be, we expect these to be strong. More than 500,000 people took part in our preview program, and 130,000 people have signed up to attend our U.S. launch events. To put these numbers in perspective, this compares with the 45,000 people who attended the launch of Windows 95, one of our most significant launches ever."