Microsoft reinvents Office for the post-PC era

Not since Office 2003 has Microsoft taken such an "ambitious undertaking" to reinvent the productivity suite. Today, PJ Hough, CVP of development for Microsoft's Office division, announced the "technical preview" for the suite's next version and then rudely announced it's "already full". Oh yeah? Why the frak tell us about it then?

It's that ambitious undertaking thing: "First time ever, we will simultaneously update our cloud services, servers, and mobile and PC clients for Office, Office 365, Exchange, SharePoint, Lync, Project and Visio", Hough claims. There's more to that boast than marketing. Microsoft is prepping Office for the cloud-connected, post-PC era. Suddenly Office 15 is going to be a big release.

Office System grows Up

Closest comparison is Office 2003, when Microsoft rebranded the suite as a "System" that included more back-end server software and collaboration features. That release reinvented Office as the top of Microsoft's server stack and gateway to back-end business processes of all kinds. Released around the same time, 2003 versions: Exchange, InfoPath, SharePoint and Windows Server, among others.

Microsoft is lining up many of the same supporting server software for simultaneous release and in the case of Windows Server 8 sooner. What's different now: Office 365 and hosted off- or on-premise versions of server products, expansion of cloud capabilities and inclusion of mobile products. Yes, this is where you can wonder if Office 15 will be available for iPad (more on that in the last paragraph).

During the 2003 release cycle, Microsoft put less emphasis on individual applications and product features and more emphasis on what people could do with Office System. Expect reaffirmation of that approach as Office 15 development proceeds. Microsoft wants to blur the difference between individual functions and features with end-user and broader corporate benefits. That's across devices -- from smartphone, to tablet, to laptop to, well, whatever. Expect Office 15 to be squarely focused on anytime, anywhere computing on anything. Like Microsoft started with Office 2003 and continued with the next two releases, there will be greater emphasis placed on data and how to maximize it -- wherever it is or needs to be -- rather than product features. Think continuum.

The original Office System strategy proved hugely successful because of dependencies. To get the full benefits of Office, businesses typically had to buy more software, particularly on the server. The strategy also transformed how businesses buy Office. Today, about 60 percent of Microsoft Business Division revenues come from volume-licensing contracts. By comparison, 75 percent of Windows sales come from OEMs or one-off sales to businesses or consumers.

There are lots of similarities between cloud computing subscriptions and software volume licensing contracts. They're booked differently but essentially mean the same thing to customers, who agree to pay Microsoft X dollars for Y time period. Licensees typically, but not always, retain rights to software after their contractual period expires. Subscriber rights end when payments stop. Several times, Microsoft unsuccessfully tried to move Office to a subscription model (there is some limited availability, however, for select segments). But the cloud changes everything. Expect Microsoft to begin talking about much more blended licensing and subscription options as Office 15 System's release approaches. This fits into the continuum approach, where Microsoft seeks to blur definitions between products other than companies need A, B, C and D to do W, X, Y and Z.

Think of Office 15 to the cloud what v2003 was to the server. Microsoft extended its applications stack vertically, with increasing cross-feature integration between the productivity suite and server software. Office 15 will accelerate Microsoft's push to the data center, taking the server stack even higher. Expect many more cross-dependent features, but this time requiring some cloud component, too. That means businesses should expect to pay more this next release cycle, as they did with Office System nine years ago -- with those already on Software Assurance getting some break, and quite possibly substantial. Additionally, Microsoft will seek to push more business customers into annuity and subscription contracts, with cross-feature dependencies driving them.

What Office 15 Means for PCs

The post-PC era isn't necessarily the end of the personal computer but its reinvention and extension to the cloud and to mobile devices. Windows 8 enters public beta late next month, which, based on recent releases means October launch. That's the milestone path followed by Windows 7 and one planned for Vista. Microsoft informed everyone that Vista wouldn't ship for holiday 2006 after missing the crucial February milestone necessary to release gold code for October launch. The point: Office 15 will follow Windows 8, which makes touch a priority, adds support for ARM processors and introduces the new Metro user interface. Windows 8 also marks Microsoft's more fervent push into new device categories, where it would want to bring Office System and cloud services.

To get there, the productivity suite needs a major makeover:

• For starters, it's long past time for a true, 64-bit version
• Office 15 will need to support ARM processors
• Metro is a must and ideally should displace the "Ribbon"
• Finally, truly touch-enabled Office must come forth

That's all without looking at the cloud and Microsoft ideally taking a more modular design approach to Office, as it does with Windows today. That one I'm guessing at; I just see it as what Microsoft should do. Since Office System 2003, Microsoft has tried to reposition the productivity suite and its supporting software as a development platform. It's time to lift upward to the cloud and datacenter.

One way to get there is modularizing the code base such that all Office versions start from the same core but offer different functionality based on device. That's not where Microsoft is today with, say, desktop and mobile Office versions -- or even Macintosh, which code is completely separate. Modular Office, as cornerstone of the broader development platform, makes sense and also fits in with broader efforts to support ARM and touchscreen tablets.

So what about iPad? There are loads of rumors Microsoft will release Office for Apple's tablet. Should it? I wouldn't. If iPad is making enterprise inroads and if the tablet supplants or replaces PCs, the last thing Microsoft should do is hurt its own applications stack. The company gains more by making Office well-suited for Windows 8 and touchscreen tablets running the software. It's one thing to be part of the post-PC era by promoting mobile devices that extend your platform's relevance and another to feed the devices of your demise. Microsoft should redefine the PC's role around mobility rather than let Apple define it with devices like iPad. Surely, this isn't rocket science.

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