The great puzzle of Microsoft Office

What will Microsoft do with Office? Or, what should Microsoft do with Office?

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.

New hardware platforms Microsoft must live (and compete) in a world beyond the PC. Phones and tablets must be part of the solution. Tablets and phones are a very different arena for software design, due to the size of the screen, the touch interface, and intermittent connectivity. Any product on the tablet or phone is a different creature than it's PC counterpart.

Multiple software platforms Microsoft must live (and compete) in a fractured world of software, with multiple operating systems (some not of Microsoft's making or control). Offerings from Microsoft must work with iOS and Android as well as Windows.

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.

Files no more

One difference between traditional IT and the new cloud IT is the storage of data. Traditional IT systems (desktop PCs) stored data in files; cloud IT systems store data in ... well, that's not so clear. And the opaqueness of cloud systems may be a good thing.

In the Old World of desktop IT, we stored data in files and used that data in application programs. Often, the data stored in files was stored in a format that was specific to the application: documents would be stored in Microsoft Word format, spreadsheets stored in Microsoft Excel format, etc. The operational model was to run a program, load a file, make changes, and then save the file. The center of the old world was files, with application programs orbiting.

In the New World of cloud computing, we store data in... something... and use that data in applications that run on servers. Thus, with Google Drive (the new name for Google Docs) we store our data on Google's servers and access our data through our browser. Google's servers recall the data and present a view of that data to us through our browser. We can make changes and save the data -- although changes in Google Drive are saved automatically.

Are we storing data in files? Well, perhaps. The data is not stored on our PC, but on Google's servers. That is the magic of "software as a service" -- we can access our data from anywhere.

Getting back to the data. Google must store our data somewhere. Is it stored in a file? Or is it stored as a byte-stream in a datastore like CouchDB or memcached? Our viewpoint on our local PC does not allow us to peer inside of the Google machine, so we have no way to tell how our data is stored.

Yes, I know that Google Drive lets us download our data to a file on our PC. We can pick the location, the name, and even the format for the file. But that is not the core existence of the data, it is an "export" operation that extracts data from Google's world and hands it to us. (We can later import that same data back into Google's world, should we want.)

With software as a service (SaaS), our data is stored, but not as files on our local filesystem. Instead, it is stored in the cloud system and the details are hidden from us.

I think that this is an advance. In traditional IT, storing data in files was necessary, a way to store information that would be usable by an application program. (At least, it was the method used by the original Unix and DEC operating systems.) The notion of a file was an agreement between the processors of data and the keepers of data.

Files are not the only method of storing data. Many systems store data in databases, organizing data by rows and columns. While the databases themselves may store their data in files, the database client applications see only the database API and manipulate records and columns.

I've been picking on Google Drive, but the same logic applies to any software-as-a-service, including Microsoft's Office 365. When we move a document from our PC into Microsoft's cloud, it is the same as moving it into Google's cloud. Are the bytes stored as a separate file, or are they stored in a different container -- perhaps SQL Server? We don't know, and we don't care.

We don't really care about files, or about filesystems. We care about our data.

Adapt or die

Nothing says "we're a big company" like the sentence "Only resumes in WORD format will be accepted". The use of passive voice is strongly correlated to bureaucracy, as is the imperious capital letters for a (perhaps not-so-humble) product.

Demanding a single format is also arrogant. First, it says that you have a certain way of doing business, and that you are unwilling to change. Second, it says that you expect everyone else to conform to your way, regardless of their procedures or technology.

I suspect that many of these companies are using this approach from inertia. In the past, when Windows and Microsoft Office dominated the market, one could reasonably expect everyone else to use the same tools.

Times have changed. Microsoft Office is still popular, and common in corporations. Especially so for large corporations. But it is not universal. People and companies (especially start-ups) use other software and other formats. Local, desktop software now includes Open Office and Office Libre. Apple iWork is available. Google Docs (now named 'Google Drive') lets you compose and edit documents, spreadsheets, and presentations. Other formats include HTML, XML, and TeX.

Demanding a single format is so 1990.


Interestingly, firms that recruit for tech positions are some of the worst offenders. While I have seen none that ask for a facsimile, most ask for resumes in Microsoft Word format - and only that format. A small percentage deign to accept PDF.

This limitation strikes me as, well, limiting. Why accept only the one format?

I can think of two reasons.

First, a single format simplifies archiving. People can point to older word processor formats (Wordstar, Wordperfect) and claim that documents in these formats are no longer readable. They are right -- those formats are unreadable by modern-day word processors.

But the next version of Microsoft Word will (most likely) drop support for the old ".doc" format. When that happens, all of their old (non .docx) Word files will be unreadable, too.

The second reason for using a single format is for simpler internal procedures. If everyone in an organization uses the same format, then the organization can standardize on a single word processor, which reduces outlays for software and time for training.

But the extension of this internal standard to external communications seems unwise. It makes other jump through your hoops, which is at best discourteous. It may irritate your customers or candidates, or worse, drive them away. Do you want to lose business over a file format?

Tech recruiters look especially bad when they do this. It changes their image from "with it" to "stodgy" and "technically capable" to "technically limited". Demanding an old format (such as the soon-to-be-dropped ".doc" format) makes on look behind the times.

If I were a technical recruiting or staffing company, I would want the best candidates for the jobs available, not just those candidates that can jump through arbitrary hoops. (Although that may be exactly what some client companies desire.) I would want to demonstrate flexibility and adaptability to candidates and clients.

Think about your internal standards and your external interactions. Do you adapt to the world, or do you expect the world to adapt to you?

Microsoft changes its direction

Microsoft recently announced a new version of its Office suite (version 13), and included support for the ODF format. This is big news.

The decision to support ODF does not mean that the open source fanboys have "won".

As I see it, the decision to support ODF means that Microsoft has changed its strategy.

Microsoft became dominant in Windows applications, in part due to the proprietary formats of Microsoft Office and the network effect: everyone wanted Microsoft Office (and nothing else) because everyone that they knew (and with whom they exchanged documents) used Microsoft Office. The proprietary format ensured that one used the true Microsoft Office and not a clone or compatible suite.

Microsoft used that network effect to drive people to Windows (providing a Mac version of Office that was close but not quite the same as the Windows version). Their strategy was to sell licenses for Microsoft Windows, Microsoft Office, Microsoft Active Directory, Microsoft Exchange, Microsoft SQL Server, and other Microsoft products, all interlocking and using proprietary formats for storage.

And that strategy worked for two decades, from 1990 to 2010.

Several lawsuits and injunctions forced Microsoft to open their formats to external players. Once they did, other office suites gained the ability to read and write files for Office.

With Microsoft including the ODF formats in Office, they are no longer relying on proprietary file formats. Which means that they have some other strategy in mind.

That new strategy remains to be seen. I suspect that it will include their Surface tablets and Windows smartphones. I also expect cloud computing (in the form of Windows Azure) to be part of the strategy too.

The model of selling software on shiny plastic discs has come to an end. With that change comes the end of the desktop model of computing, and the dawn of the tablet model of computing.

Microsoft Office becomes hip because Facebook did

The new Microsoft Office 2010 edition has a number of improvements, ranging from animations on the opening splash screen to collaborative capabilities. Microsoft Outlook has a special feature, one that I have not seen in the other products of the suite.

Microsoft Outlook has a social networking feel to it, with incoming e-mails showing avatars of the sender and their immediate network. That's a neat trick, since few people in our office have the latest version of MS Office, and therefore have had no opportunity to set up a social network. (And to be honest, the avatars are all generic "shadow" avatars.)

But this is a change to look like a social network without actually being one.

It turns out that you as the user don't define your social network in MS Outlook -- the software uses the organization's network defined in the Active Directory server. People are members of departments (or groups, or branches, or whatever) and MS Outlook relies on this structure. Which means that the social network image of MS Outlook is just that: an image. It's not my social network (where I can friend and unfriend people), it is the company's definition of a social network: the people in my assigned organizational unit.

It looks cool, until you realize what's happening. Is this an attempt at making a staid (dare one say "quaint") interface more hip? is it a way to make MS Outlook more acceptable to the generation that was raised on Fascebook? Perhaps.

Hipness aside, this change demonstrates that Microsoft felt compelled to change Outlook. Perhaps the change was driven by the collaboration capabilities, but I feel that Microsoft is attempting to compete with Facebook. Which means that Facebook is driving the design of software, not Microsoft.