November 13, 2000 2:50 PM PST

Microsoft to sell Office as subscription service

LAS VEGAS--Microsoft on Monday said consumers and small businesses will be able to buy future versions of Microsoft Office through a yearly subscription.

Comdex 2000:
Back to the future Microsoft announced the new subscription offering at the Comdex trade show here. Consumers and small businesses will be able to buy the dominant PC office suite at a lower cost at retail stores by paying an annual fee. Microsoft executives said customers will receive free product upgrades as part of the subscription, but they will have to renew their subscription each year at the same price.

Lisa Gurry, Microsoft's Office product manager, said the software giant announced the offering to give its customers a new way to purchase the next version of Microsoft Office, which is expected to be released in spring 2001. Previously, customers bought the word processing, spreadsheet, email and presentation software as a boxed product in retail stores and on the Web.

"Renewing on a yearly basis will lower the up-front fees for consumers and businesses," Gurry said. "It's like paying for a magazine subscription or a cell phone service."

Microsoft chairman Bill Gates previewed the new version of Microsoft Office in his keynote address Sunday. Code-named Microsoft Office 10, the suite offers a range of new features, including speech-recognition technology for correcting and editing Word documents.

Microsoft dominates the desktop application market, which includes Corel's WordPerfect and Lotus Development's SmartSuite. Sun Microsystems also offers Star Office, a Linux-based productivity suite that can be downloaded for free. Corel unveiled demonstrations of its next version of WordPerfect at Comdex on Monday.

Microsoft has already released two test versions of Microsoft Office 10. As reported earlier, the new version of Microsoft Office also includes technology called "smart tags," which lets people click on a word or name within a document to send email, schedule a meeting, find an address, or retrieve more information, such as Internet links to a dictionary definition of the word.

In what the company has dubbed a "team workplace" application, people will be able to add and edit content, such as announcements and documents, on a common Web page using a Web browser without needing to know HTML.

Along with building Office 10, Microsoft is simultaneously developing an entirely new version of Office as part of its .Net strategy. Office.Net, expected to debut in 2002, will feature a "natural user interface," such as handwriting and speech recognition, and will be completely Web-based, the company has said.

Corel's forthcoming WordPerfect Office 2002, which will ship in the first half of 2001, includes several new features, including an email program and the ability to turn text, such as a company's sales figures, into a graphic with a click of a button, said Dave Ludwick, Corel's director of product development.

Corel, which already bundles voice recognition technology in its office products, will also include an electronic version of the Oxford English Dictionary in the new version of WordPerfect. All of Corel's software is compatible with Microsoft Office products, Ludwick said.

 

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