Microsoft built an empire with Office. Office was the most powerful word processor and spreadsheet package. It used proprietary formats. It read files from other word processors and spreadsheets but did not write to those formats, making the trip for data one-way: into Microsoft Office. Through marketing, fierce competition, and the network effect, Microsoft convinced most businesses and most home users to use (and buy) Microsoft Office.
Those were the days.
The world is changing.
Large businesses still use Windows for their desktop environment. Small businesses, especially technology start-ups, are using Mac OS or Linux.
Large businesses still use Microsoft Office. Small businesses are looking at LibreOffice (an open source desktop package with word processing and spreadsheets) or Google Apps (an on-line office package with word processing, spreadsheets, e-mail, calendaring, and other things).
The tablet world is dominated by iOS (on iPads) and Android (on just about everything else). Windows holds a tiny share. The same goes for smart phones.
These are the pieces of the great puzzle that Microsoft must solve. What is a software giant to do?
First, some observations.
Microsoft is the latecomer Microsoft is late to the market, but they have been in this position before and succeeded. They were late with C#/.NET after Java. They were late with Internet Explorer after Netscape Navigator. They were late with spreadsheets after Lotus 1-2-3. They were late with word processors after Wordstar and WordPerfect. They were late with databases after dBase and R:Base. Being a latecomer has not doomed Microsoft yet.
The desktop software model doesn't work on mobile devices Microsoft's past technique of selling premium software and obtaining market share through marketing won't work on the mobile platform.
Giving these conditions, Microsoft needs a new approach. Here are some ideas:
Sell services, not software Microsoft will not focus on selling copies of Office for the mobile world. Instead, it will focus on subscribers to its services. The mobile versions of Word and Excel and Outlook will be offered at low prices -- perhaps at no cost -- but they will be useless without the service.
Cloud storage, not local files Microsoft Office will store data in the cloud (Microsoft's cloud).
Not documents and workbooks, but pieces assembled Instead of entire documents and complete spreadsheets, Microsoft services will stitch together fragments of documents and spreadsheets. Think of it as an advanced form of OLE. (Remember OLE and our excitement at embedding a spreadsheet in a document?)
Versioning and tracked changes Microsoft's cloud will keep track of the versions of each document (or document fragment), allowing us to see changes over time and the notes for each change.
Access control (for enterprise users) With all of these fragments floating in the cloud, enterprise users (businesses and their support teams) will want to control access by users.
Promotion and publication (also for enterprise) Users will be able to publish data to other users. Users will also be able to work on new versions of data, reviewing it with other members of their team, revising it, and eventually marking it as "available to everyone". Or maybe "available to selected users".
The idea of Office as a service seems a natural fit for mobile devices. Notice this this vision does not demand Windows tablets -- one can use it with iPads and Android devices. I expect Microsoft to move in this direction.
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