December 9, 2008

Microsoft Planning To Release Web-Based Applications

According to a senior executive at Microsoft, the company will begin selling online versions of its software and expects the weak economy to accelerate the growth of the Web-based software market.

Stephen Elop, president of Microsoft's business division, is helping lead Microsoft's charge into the "software as a service" market, offering programs hosted online instead of being installed on computer hard drives.

Microsoft customers will not have to spend as much money on computer maintenance by using the web to host programs like Microsoft Office, Exchange, and Sharepoint.

"What we think is in five years, 50 percent of the use of Exchange and Sharepoint could be serviced from the cloud," Elop said.

"Between now and then, a year or two or whatever, if it's going to be tough economic times, that means we expect quite a lot of movement in that direction, a lot of people taking advantage of that," he added.

The company's move into online software comes in the midst of stiff competition from Google Inc.'s free Google Apps web services which include calendars, email, and messaging software.

Microsoft plans to upgrade it Office business software to include online versions of Word and Excel. 

According to Elop, the company will soon announce a large range of services, including some free services maintained by advertising.

"We expect fully that the full range of Office utilities, from the most advanced to simpler lightweight versions, will be available with a range of options: ad-funded, subscriptions-based, traditional licensing fees, and so forth. So you should expect to see that full array," he said.

Elop would not give a specific date for release, but said a lot of advancement would be made in 2009.

He believes the company will make a profit within a year of launching the new initiative.

Elop also said Microsoft's free versions will outperform Google Apps in their capabilities, and their rich software services will give it another advantage over the popular search engine company.

According to Elop, many customers showed strong interest in the online applications.

"We may have underestimated the extent to which customers will move in this direction," he said.


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