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And then there’s Microsoft.

Microsoft effectively has a monopoly on the PC and workstation desktop but it has a problem in driving us to buy software when there isn’t a new version of Office or Windows to tempt us. Windows XP was released in 2001 and Office 2003 in, um, 2003. As we know Windows Vista is scheduled for the end of 2006 and Office 12 is also due to be released late in 2006, which leaves a bit of a gap for four or five quarters. Microsoft CEO Steve Ballmer addressed the question at the 2005 Financial Analyst Meeting in Redmond, Washington on July 28, 2005.

Ballmer noted that Microsoft has seen its revenue grow from US$25 billion to $40 billion and its operating profits climb from $12 billion to $19 billion over the past five years, while its total spending on research and development has increased by 25 per cent. He also displayed a chart showing that Microsoft’s share of the total operating income among 25 leading information technology companies (which includes Dell, Google, IBM, Intel and Yahoo) has grown from 18 per cent to nearly 23 per cent over the same five-year period.

He then went on to say that “There is no way for our company to grow without innovation. We’ll achieve that growth not only by focusing on our anchor businesses but by competing and winning in a wide range of new services – many of them based on advertising or subscription revenue – and by creating a new portfolio of products that meet the growing needs of our customers.”

Reuters reported that Ballmer went on to say that "We have plans in the next generation for something even higher-end in Office that we call Office Premium,"
"And when you take a look at all of the premium work that we're doing in management and security and email, we think about a new premium client access license also for our Windows product," Ballmer said. "All of that drives new value."
Beta 1 of Windows Vista includes Windows Media Player 10 but there’s no sign of antivirus or anti-spyware software, so possibly this could be included in the Premium version of Windows, but Office is a completely different story.

The Standard Edition of Office 2003 has four parts, Excel, Outlook, PowerPoint and Word. The Small Business Edition adds Outlook Contact Manager and Publisher, and the Professional Edition tacks Access on the top of that. Full retail pricing is in the £300-£400 range but only suckers pay the full rate as individuals buy the Student and Teacher license for less than £90 while businesses get a discount or pay about £35 per seat per year.

I am scratching my head, wondering where on earth Microsoft expects to crowbar extra content into the Office suite. To be frank, I didn’t think much of the new features that were added to Office 2003 as we freelancers don’t go much for group working, and the joys of XML somewhat pass me by. I would be perfectly happy to use Office XP so I’m at something of a loss as to what Microsoft will add to Office Vista or whatever it calls the new version of Office. No doubt there will be the usual sleight of hand about Office Vista having features that work best of all with Windows Vista, and no doubt it will only run on Windows XP and Vista with no support for Windows 2000. At the end of the day Office Vista will be a tool for writing letters, opening presentations, creating spreadsheets and sending email.

I desperately want to laugh off the idea of Microsoft Premium products as they are already gold plated and ludicrously expensive, but that would be foolishly short sighted. Gates has a worth of more than US$50 billion and Ballmer is worth US$15 billion, and they didn’t amass that sort of wealth without overcoming a few problems along the way. I have no idea what features will be in Office Vista Premium or what it will cost but it’s a safe bet that it’s coming to a computer near you in 2007. Enjoy.

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