Foley on Microsoft

Why Is Redmond So Bullish on Office Live?

Despite the offering's rocky beginnings, Office Live may still turn out to be a pleasant surprise.

To date, Office Live -- Microsoft's set of services extensions to its client-based Office productivity suite -- has felt like little more than an afterthought. But I think Microsoft has some Live tricks up its sleeve for its Office services. Here are some reasons why:

Microsoft officials have predicted that within two to three years, Office Live will be one of the most important product families for the company as a whole. Chief Operating Officer Kevin Turner told attendees of Microsoft's Worldwide Partner Conference in July:

"We fully expect in two or three years Office Live will be one of the most deployed, most utilized of all the products we have in the Microsoft portfolio. Certainly it won't be as big as Windows in a couple of years, but we do believe it will reach our top three or four largest deployed applications."

So what does Turner know to be coming down the Office Live pike that we don't?

Even though Microsoft has hundreds of thousands of Office Live customers on the books, Office Live has had its share of false starts.

A number of Office Live customers undeniably have had a rough go of it. First, there was somewhat of a bait and switch when Microsoft rolled out the first three Office Live SKUs, with the promised Collaboration SKU being replaced with the unannounced Premium release. Then there were conversion problems galore. It took Microsoft months to migrate the initial set of 190,000 beta testers. Features like backup and restore didn't work from November 2006 to when their accounts were finally migrated. Plus, testers got only a 24-hour heads-up as to when Microsoft planned to migrate them.

In the Works
A rocky start hasn't daunted the Office Live team, however. It's got some ambitious plans. Here is a list of things known to be in the works:

• A personal version of one or more Office Live services aimed at consumers and small office/home office users. The "personal" version of Office Live might or might not debut in the form of a hosted version of Microsoft's low-end productivity suite, Microsoft Works.

• An enterprise version of one or more Office Live services. The postponed Office Live Collaboration SKU is expected to be one of these.

• More third-party extensions to the core Office Live SKUs, at all levels. In some cases, these extensions/mashups might consist of Microsoft services and software (like Virtual Earth or Windows Live Spaces) integrated with Office Live. In others, independent developers will deliver custom and/or commercial integrations.

Educated Guess
This is all well and good. But I think there's something bigger coming on the Office Live front. And I think whatever it is could be positioned as Microsoft's competitor to Google Apps.

My educated guess? Microsoft is going to use Windows Live ID, its online authentication service, in combination with the Office Live Discovery Web service. This will let Office users access their Office documents over the Web in a secure way. What if you could work locally on an Excel spreadsheet, and then access, modify (and share, if appropriate) that spreadsheet using a shared Office Live workspace? When you sign back into your local copy of that spreadsheet, changes you made offline could be synched up automatically. Wouldn't that be the ultimate expression of the Software Plus Services scenario that Microsoft has been promising?

While I'm going out on a limb, let me field one more prediction: Don't be surprised to see vertical Office Live services debut in the next year or two such as: Office Live for Dentists; Office Live for Real Estate Brokers; Office Live for Doctors (the latter service might be one of the expected Microsoft "Live Healthcare" offerings I keep hearing about).

What about you? What do you think Microsoft will do to make Office Live one of the biggest revenue generators for the company in the coming few years? Do you have any wild and crazy predictions to share?

About the Author

Mary Jo Foley is editor of the ZDNet "All About Microsoft" blog and has been covering Microsoft for about two decades. She has a new book out, Microsoft 2.0 (John Wiley & Sons, May 2008), about what's next for Microsoft in the post-Gates era.

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