Office 2010 ‘cements Microsoft’s supremacy’ in productivity suites market

Canadian businesses overwhelmingly plan to upgrade to either Microsoft Office 2010 or 2007 by the end of 2011, and some will complement licences of the office suite with less expensive or free alternatives, according to an analyst survey.

Nintey-nine per cent of businesses surveyed have standardized on Microsoft Office, according to London, Ont.-based analyst firm Info-Tech Research Group. Those firms also plan to upgrade to either Office 2010 (33 per cent) or Office 2007 (52 per cent) within the next 18 months, Info-Tech says Currently most businesses are using Office 2003 or earlier (58 per cent).

The stats pour cold water on the notion that alternative office suites such as Google Docs or other open source alternatives are encroaching on Microsoft’s territory. They are also supported by a Gartner Inc. report finding of a 94 per cent worldwide marketshare for Office.

“The market really is saturated [in favour of] Microsoft … Google is no threat at all,” says Tim Hickernell, Info-Tech’s lead research analyst. “Bottom line is hardly anyone has done a total switch. It isn’t worth it for most Microsoft shops to do a switch.”

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But there may be some room for competing office suites to sneak in and complement Microsoft’s suite. Especially with the business launch of Office 2010 yesterday, some firms will be making decisions about how many licences they really need.

This works best for employees who aren’t creating a lot of rich content, Hickernell notes. One Info-Tech customer saved $30,000 by outfitting sales staff with OpenOffice, a free alternative, instead of buying Office licences.

Microsoft’s launch of Office 2010 may prompt many businesses to embrace the Office Open XML formats introduced with Office 2007. Businesses may also be wooed by new collaboration features and integration with freely accessible Office Web Apps.

Word 2010 and PowerPoint 2010 both feature real-time collaboration capabilities, says Antoine Leblond, senior vice-president of the Office productivity applications group at Microsoft Corp.

Outlook 2010 will also bring a more collaborative feel to e-mail by integrating social networking feeds.

“It brings all that information together in Outlook, where folk are spending a lot of their time already,” he says. “We’ll cover most significant social networks with our social connectors.”

Microsoft has already released connectors for LinkedIn and MySpace. New connectors for Facebook and Windows Live are coming around the time of the June consumer launch.

Collaboration has been the flagship feature of Google Docs. The Mountain View, Calif.-based search giant has started selling its own office suite through the channel since February 2007, but convincing businesses to abandon the warm familiarity of Microsoft has been a hard sell.

That’s why Google recently rebuilt the editors for Google Docs from the ground up to resemble something people are used too, says Rajeth Sheth, senior product manager with Google Apps.

“There are going to be some people who just can’t give up Microsoft Office because of the comfort level,” he says. “We think we’re at a point where a company could take a significant portion of their users and actually have them use Google as their primary productivity suite.”

Many firms running Google Docs made the switch after adopting Google as an e-mail platform, Hickernell says. “Google Docs often rides the coattails of Gmail.”

Playing sidekick to Office may be the best Google can hope for, according to Info-Tech’s survey. Businesses face too many costs related to training, integration with business applications, file conversion, and other softer factors.

“They’d rather ask for the money [for licences] than risk a backlash from ripping Office out of the hands of employees,” Hickernell says.

Microsoft has also added collaboration features with Office 2010, countering some of Google’s best features. Businesses running Office 2010 behind the firewall will rely on Sharepoint 2010 to facilitate the collaboration features, while others will rely on cloud-based Windows Live to act as the backend.

“It’s the norm to have remote workers today – employees based around the world, employees who telecommute, or just your typical end-of-workday fuzziness,” Leblond says. “You can’t get everyone in a room anymore to solve problems. That places a burden on IT.”

Still, only 14 per cent of businesses plan to use Office Web Apps, according to Info-Tech’s survey of 118 enterprises. Collaboration just isn’t as important to businesses as you might expect.

“We couldn’t find anyone who thought they needed the concurrent editing [feature],” Hickernell says. “It wasn’t a big deal.”

Meanwhile, Google is still pushing its desktop alternative to real-time collaboration. Using recent acquisition DocVerse as a backend, Google is offering its users the ability to collaborate concurrently in Office 2003 and Office 2007.

It offers firms a chance to stick with their current version of Office and avoid a costly upgrade project, Sheth says.

“To get that new functionality with Office 2010, you’ll have to implement Sharepoint 2010,” he says. “That’s a fairly significant project for a company to undertake.”

But for 31 per cent of companies surveyed by Info-Tech, upgrading to Office 2010 is a “no-brainer,” Hickernell says. The firms already own the licence because of their software assurance program and haven’t upgraded from Office 2003. Other firms who own the licence for 2010 but are already running 2007 needn’t rush into an upgrade.

For the 15 per cent of firmson Office 2007 and don’t own Office 2010 already, Info-Tech is recommending they at least take a look at the competition.

Not that Microsoft competitors should get their hopes up.

Aside from Office 2010, Microsoft also launched Sharepoint 2010, Visio 2010 and Project 2010 for business yesterday.

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