Microsoft Hints at New Web Software
After Microsoft mentioned the possibility of launching Web-based versions of its software in an interview with Reuters, analysts and journalists have set the Internet abuzz.
According to a Reuters report, Microsoft plans to fund free versions of scaled down Office suite applications. The Web-based program, a version of Microsoft Works, will be designed to help users share documents and collaborate on projects with colleagues without having to e-mail files.
But analysts warn that Microsoft will have to navigate several potential minefields if it decides to offer its word processing and spreadsheet programs online.
Fighting Google
The move to free Web-based programs is seen as way to slow Google's recent progress in promoting their free versions of a similar offering. Google uses an advertising based business model for the products.
While getting something for free never sounds like a bad deal, JupiterResearch senior analyst Joe Wilcox said he is skeptical of the move. He says Microsoft is making a mistake taking on Google in a battle of Web-based applications.
"I've got to strongly encourage Microsoft folks to resist making product decisions in response to competitors," said Wilcox. "There simply is too much of this kind of behavior going on."
Microsoft Works online would allow small businesses to create customer contact lists for their employees and develop business e-mail accounts among other applications. Microsoft currently offers Works for approximately $50 and it includes a word processor, spreadsheet calendar and e-mail applications.
Consumer Benefits
Wilcox says he has trouble seeing an upside for Microsoft and its users. "Works as part of Office Live risks cannibalizing Office sales to small businesses," he said. "I simply don't see a strong upsell opportunity to Office."
"If Microsoft does bring Works to the Web, the reason should be to bulk up the commoditized functions of its Windows Live products and services," said Wilcox.
Last month Google announced it would offer software providing a range of online services for business users. Google Calendar, Spreadsheets and the word processing application Writely are all online in Beta.
Microsoft has not issued an official release and did not say when it planned to launch the free programs on the Web.